The Second Wave of Global Liquidity: Why Are Firms Acting Like Financial Intermediaries?
Recent work suggests non-financial firms have acted like financial intermediaries particularly in emerging economies. This paper corroborates these findings but then asks "why?" The results indicate evidence for carry-trade activities, but they are focused on countries with higher levels of capital controls, particular controls on inflows. There is little evidence for such activities given other potential motives. It is posited that this phenomenon is due more to the reaction of countries in the face of low global interest rates, quantitative easing and strong capital inflows than incomplete markets or the retreat of global banks due to impaired balance sheets or tighter regulations.
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Format: | Working Papers biblioteca |
Language: | English |
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Inter-American Development Bank
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Subjects: | Capital Control, Carry Trade, Financial Asset, Financial Bond, Interest Rate, Global Financial Crisis, Financial Risk, E51 - Money Supply • Credit • Money Multipliers, F30 - International Finance: General, F33 - International Monetary Arrangements and Institutions, financial intermediaries;interest rates;foreign currency bond issuance;financial asset, |
Online Access: | http://dx.doi.org/10.18235/0011735 https://publications.iadb.org/en/second-wave-global-liquidity-why-are-firms-acting-financial-intermediaries |
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dig-bid-node-124652024-05-30T20:30:06ZThe Second Wave of Global Liquidity: Why Are Firms Acting Like Financial Intermediaries? 2016-05-04T00:00:00+0000 http://dx.doi.org/10.18235/0011735 https://publications.iadb.org/en/second-wave-global-liquidity-why-are-firms-acting-financial-intermediaries Inter-American Development Bank Capital Control Carry Trade Financial Asset Financial Bond Interest Rate Global Financial Crisis Financial Risk E51 - Money Supply • Credit • Money Multipliers F30 - International Finance: General F33 - International Monetary Arrangements and Institutions financial intermediaries;interest rates;foreign currency bond issuance;financial asset Recent work suggests non-financial firms have acted like financial intermediaries particularly in emerging economies. This paper corroborates these findings but then asks "why?" The results indicate evidence for carry-trade activities, but they are focused on countries with higher levels of capital controls, particular controls on inflows. There is little evidence for such activities given other potential motives. It is posited that this phenomenon is due more to the reaction of countries in the face of low global interest rates, quantitative easing and strong capital inflows than incomplete markets or the retreat of global banks due to impaired balance sheets or tighter regulations. Inter-American Development Bank Julián Caballero Ugo Panizza Andrew Powell Working Papers application/pdf IDB Publications en |
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Capital Control Carry Trade Financial Asset Financial Bond Interest Rate Global Financial Crisis Financial Risk E51 - Money Supply • Credit • Money Multipliers F30 - International Finance: General F33 - International Monetary Arrangements and Institutions financial intermediaries;interest rates;foreign currency bond issuance;financial asset Capital Control Carry Trade Financial Asset Financial Bond Interest Rate Global Financial Crisis Financial Risk E51 - Money Supply • Credit • Money Multipliers F30 - International Finance: General F33 - International Monetary Arrangements and Institutions financial intermediaries;interest rates;foreign currency bond issuance;financial asset |
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Capital Control Carry Trade Financial Asset Financial Bond Interest Rate Global Financial Crisis Financial Risk E51 - Money Supply • Credit • Money Multipliers F30 - International Finance: General F33 - International Monetary Arrangements and Institutions financial intermediaries;interest rates;foreign currency bond issuance;financial asset Capital Control Carry Trade Financial Asset Financial Bond Interest Rate Global Financial Crisis Financial Risk E51 - Money Supply • Credit • Money Multipliers F30 - International Finance: General F33 - International Monetary Arrangements and Institutions financial intermediaries;interest rates;foreign currency bond issuance;financial asset Inter-American Development Bank The Second Wave of Global Liquidity: Why Are Firms Acting Like Financial Intermediaries? |
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Recent work suggests non-financial firms have acted like financial intermediaries particularly in emerging economies. This paper corroborates these findings but then asks "why?" The results indicate evidence for carry-trade activities, but they are focused on countries with higher levels of capital controls, particular controls on inflows. There is little evidence for such activities given other potential motives. It is posited that this phenomenon is due more to the reaction of countries in the face of low global interest rates, quantitative easing and strong capital inflows than incomplete markets or the retreat of global banks due to impaired balance sheets or tighter regulations. |
author2 |
Julián Caballero |
author_facet |
Julián Caballero Inter-American Development Bank |
format |
Working Papers |
topic_facet |
Capital Control Carry Trade Financial Asset Financial Bond Interest Rate Global Financial Crisis Financial Risk E51 - Money Supply • Credit • Money Multipliers F30 - International Finance: General F33 - International Monetary Arrangements and Institutions financial intermediaries;interest rates;foreign currency bond issuance;financial asset |
author |
Inter-American Development Bank |
author_sort |
Inter-American Development Bank |
title |
The Second Wave of Global Liquidity: Why Are Firms Acting Like Financial Intermediaries? |
title_short |
The Second Wave of Global Liquidity: Why Are Firms Acting Like Financial Intermediaries? |
title_full |
The Second Wave of Global Liquidity: Why Are Firms Acting Like Financial Intermediaries? |
title_fullStr |
The Second Wave of Global Liquidity: Why Are Firms Acting Like Financial Intermediaries? |
title_full_unstemmed |
The Second Wave of Global Liquidity: Why Are Firms Acting Like Financial Intermediaries? |
title_sort |
second wave of global liquidity: why are firms acting like financial intermediaries? |
publisher |
Inter-American Development Bank |
url |
http://dx.doi.org/10.18235/0011735 https://publications.iadb.org/en/second-wave-global-liquidity-why-are-firms-acting-financial-intermediaries |
work_keys_str_mv |
AT interamericandevelopmentbank thesecondwaveofgloballiquiditywhyarefirmsactinglikefinancialintermediaries AT interamericandevelopmentbank secondwaveofgloballiquiditywhyarefirmsactinglikefinancialintermediaries |
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