Veel succes, arbeidsmarkt Nederland #2

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Op zondag 15 december 2013 23:17 schreef arjan1112 het volgende:

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Dan is de vraag meer, waarom grepen de toezichthouders niet in toen de banken, verzekeraars en pensioenfondsen zich niet aan de no - bailout regels hielden?

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Any additional widening of yield differentials must be attributable to perceived differences in country-specific default risk, since this is the only remaining characteristic that can be used to distinguish securities issued by different EMU members. As Benjamin Friedman notes, the default risk premium arises as a consequence of the fact that “government obligations, [are] no longer guaranteed by the ability of individual borrowing countries to print the money in which their bonds are denominated” (2001: 2). [7] Thus, the fact that debts have to be repaid in a currency that member governments cannot create at will (i.e. euros) implies that “the previously remote possibility of default becomes a significant risk” (Copeland and Jones, 1999: 3).

Initially, Copeland and Jones (1999) found that markets were calculating the probability of default at a much lower level than might have been expected, suggesting that investors were not terribly worried about credit risk. [8] They offered two possible explanations for this. First, it was possible that market participants, subscribing to the media’s prognosis of “unhampered yield convergence among EMU members,” failed to realize that the potential for default had actually changed (ibid.: 5). Second, it was possible that traders were “well aware of the credit risks of Euro-denominated repayments” but decided not attach significant premiums to compensate for these risks, since it was unlikely that the EU would allow a member government to default (ibid.). [9]

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[9] This implies that the Treaty’s no-bailout clause – the provision that neither the Community nor any member state shall be “liable for or assume the commitments of central governments, regional, local or other public authorities, other bodies governed by public law, or public undertakings of any Member State, without prejudice to mutual financial guarantees for the joint execution of a specific project” (The Treaty on Monetary Union: Article 104b) – was not perceived as credible.

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