Housing and Personal Wealth in a Global Context

Housing is the single most important component of personal wealth in most countries. The special characteristics of housing markets are therefore key to understanding personal portfolios, saving, the household distribution of wealth, and the monetary transmission mechanism. This paper discusses how housing markets and institutions differ across countries, paying particular attention to the UK and the EU, but extending its reach as well to other OECD countries such as Japan and emerging market countries such as South Africa. It analyzes how those differences help to create contrasts in the impact on consumption of housing as a component of personal wealth. The impacts of rates of home ownership, credit market characteristics, interest rates, and macroeconomic conditions are studied. Implications for monetary, fiscal, and other policies are discussed.housing, wealth, consumption, interest rates, monetary transmission

A quantitative analysis on the management of interest rate risk during 2022, by selected companies on the Oslo Stock Exchange.

The purpose of the dissertation has been to look at how the hikes in interest rates have affected the most traded companies on the Oslo Stock Exchange (OBX). This has been done in a purely quantitative manner through manual data collection from financial reports. The findings indicate that the companies have experienced a substantial increase in the cost of debt in 2022.There were reactive attempts to mitigate the consequences of the rate hikes in the short-term. Those were on average not very effective. At the same time most of the companies fared better than they expected they would according to their own interest rate risk analysis. There have been some indications of attempts at reducing the long-term effects of the rate hikes. This has mostly been through risk mitigation and attempts at hedging against further rate hikes. Very few have bet on rate cuts as an attempt at long-term action against rate hikes, indicating that many expect the rates to remain high in the foreseeable future

The Banking Crisis, Banking Policy Regimes and the Value of a Bank

This paper studies the value of a bank under different banking policy regimes. As banks run into financial distress, authorities in different countries have used different approaches to deal with the crisis. The Nordic countries provide examples of different policy approaches. The results show that the uncertainty over the banking policy regime and changes in this uncertainty can have a major impact on the value dynamics of bank shares. The model produces moral hazard problems both before and after public sector intervention. On the other hand, bank support can increase the original shareholders' incentive to inject new capital into the bank. The model also implies that the government may have an incentive to cheat the bank's shareholders in order to ensure more capital injections from them.banking crisis; banking policy regime; bank support