Keith Sill is a senior economist in the Research Department of the Philadelphia Fed. Our economy has become increasingly global. We import and export more than ever before. Yet, three facts about international financial transactions, when taken together, pose a puzzle. First, financial capital moves freely across country borders, at least in the case of the developed countries. Returns on simil...

In this study it has been initiated to find out the credit strength and financial performance of cement industries in Bangladesh through investigating the financial report for the period from 2007 to 2011. Financial ratios are employed to measure the Liquidity (Working capital to Total Assets), Profitability (Retained Earnings to Total Assets), Efficiency (Earnings before Interest and Taxes to ...

While the traditional view of financial innovation emphasizes the risk sharing role of new financial assets, belief disagreements about these assets naturally lead to speculation, which represents a powerful economic force in the opposite direction. This paper investigates the effect of financial innovation on portfolio risks in an economy when both the risk sharing and the speculation forces a...

T his paper examines the effect of factors on the development of commercial banking in Iraq. Seven factors used as determinates for financial depth which are per capita GDP, inflation rate, government budget deficit, share of state-owned banks of total assets as proxy of financial repression, oil sector domination, international trade openness and political stability as explanatory v...

We propose a simple model of financial crises, which may be useful for the unified analysis of macro and financial policies implemented during the 2008–2009 financial crisis. A financial crisis is modeled as a disappearance of inside money due to the lemon problem à la Akerlof (1970), in a simplistic variant of Lucas and Stokey’s (1987) Cash-in-Advance economy, where both cash and capital stock...

We study an economy with several agents, who receive endowment streams denominated in units of a certain commodity over a finite horizon. The agents can consume the commodity, and they can also trade it at a certain "spot price" >/>; the proceeds of these transactions can be invested in financial assets, whose prices are modelled by continuous semimartingales. The objective of each agent is to ...

In this paper we study the pricing and hedging of a very general class of life insurance liabilities by means of the risk-minimization approach. We find the price and risk-minimizing strategy in two cases, first in the case when the financial market consists only of one risky asset, e.g. a stock, and a bank account, and second in an extended financial market, allowing for investments in two add...

17 ntangible assets are both large and important. However, current financial statements provide very little information about these assets. Even worse, much of the information that is provided is partial, inconsistent, and confusing, leading to significant costs to companies, to investors, and to society as a whole. Solving this problem will require on-balance-sheet accounting for many of these...