Procyclical Effects of the banking System during the financial and economic Crisis 2007-2009: the Case of Europe

This paper examines the relationship between adverse shocks to the banking system and their effect on the general economy in Europe. This topic was brought to the spotlight during the 2007-2009 financial and economic crisis, when the relatively healthy, at that time, European economy was severely hit by the spread of the US sub-prime mortgage problems. This interbanking contagion may have been one of the main, if not the primary, reasons why the region entered into a recession during the period. If significant evidence can be found to support this theory, it will make the need for more regulations on the financial system and stricter capital requirements even more apparent. The research includes comprehensive literature survey on past and recent financial crises, procyclical banking practices and their impact on the economy. Then it goes on to developing a theoretical model of the transmission of negative economic shocks from the financial system to the rest of the economy. The theoretical model is empirically tested on a range of banking specific and macroeconomic variables. The results show that a loss of confidence in the financial system and banking losses are followed by a significant decrease in the new loans to non-financial companies and subsequent economic contraction. Moreover, countries with better capitalized banks experienced smaller declines during the crisis and in general Tier 1 capital is correlated positively with economic growth.economic shocks, financial crisis, banking system stability, procyclical effects

Procyclical Effects of the banking System during the financial and economic Crisis 2007-2009: the Case of Europe

This paper examines the relationship between adverse shocks to the banking system and their effect on the general economy in Europe. This topic was brought to the spotlight during the 2007-2009 financial and economic crisis, when the relatively healthy, at that time, European economy was severely hit by the spread of the US sub-prime mortgage problems. This interbanking contagion may have been one of the main, if not the primary, reasons why the region entered into a recession during the period. If significant evidence can be found to support this theory, it will make the need for more regulations on the financial system and stricter capital requirements even more apparent. The research includes comprehensive literature survey on past and recent financial crises, procyclical banking practices and their impact on the economy. Then it goes on to developing a theoretical model of the transmission of negative economic shocks from the financial system to the rest of the economy. The theoretical model is empirically tested on a range of banking specific and macroeconomic variables. The results show that a loss of confidence in the financial system and banking losses are followed by a significant decrease in the new loans to non-financial companies and subsequent economic contraction. Moreover, countries with better capitalized banks experienced smaller declines during the crisis and in general Tier 1 capital is correlated positively with economic growth

Procyclical Effects of the banking System during the financial and economic Crisis 2007-2009: the Case of Europe

This paper examines the relationship between adverse shocks to the banking system and their effect on the general economy in Europe. This topic was brought to the spotlight during the 2007-2009 financial and economic crisis, when the relatively healthy, at that time, European economy was severely hit by the spread of the US sub-prime mortgage problems. This interbanking contagion may have been one of the main, if not the primary, reasons why the region entered into a recession during the period. If significant evidence can be found to support this theory, it will make the need for more regulations on the financial system and stricter capital requirements even more apparent. The research includes comprehensive literature survey on past and recent financial crises, procyclical banking practices and their impact on the economy. Then it goes on to developing a theoretical model of the transmission of negative economic shocks from the financial system to the rest of the economy. The theoretical model is empirically tested on a range of banking specific and macroeconomic variables. The results show that a loss of confidence in the financial system and banking losses are followed by a significant decrease in the new loans to non-financial companies and subsequent economic contraction. Moreover, countries with better capitalized banks experienced smaller declines during the crisis and in general Tier 1 capital is correlated positively with economic growth

DESIGNING A TOOLSET FOR THE PRIME VIRTUAL BUSINESS ENVIRONMENT

The PRIME (Providing Real Integration in Multi-disciplinary Environments) project1 aims in modeling, creating and evaluation of a Virtual Business Environment (VBE) for learning the entire life cycle of products and processes for all involved stakeholders and for gaining practical experience in strategic manufacturing through serious gaming. The paper presents the overall architecture of the PRIME system. Further it discusses in more detail the design of the game toolset, which provides the user interface to system models such us: the life cycle of products and processes and all involved stakeholders. By providing various tools for management of business process semantics and dynamics, the toolset facilitates defining different end user scenarios upon scenarios templates within the VBE

Cyclophyllidean cysticercoids from Echinogammarus tibaldii (Amphipoda, Gammaridae) from Lake Piediluco, Italy

AbstractIn August 2007, 856 specimens of Echinogammarus tibaldii Pinkster et Stock, 1970 from the Lake Piediluco (Central Italy) were collected from 3 different sites and examined for larval helminths. Fourteen amphipods (1.63%) were infected with larvae of Lateriporus teres (Dilepididae) and one amphipod (0.12%) was infected with Microsomacanthus microsoma (Hymenolepididae). Adults of both species are known from waterfowl and gulls. The present results constitute new host records for both cestode species and the first finding of L. teres in Italy

Liquid polystyrene: a room-temperature photocurable soft lithography compatible pour-and-cure-type polystyrene

Materials matter in microfluidics. Since the introduction of soft lithography as a prototyping technique and polydimethylsiloxane (PDMS) as material of choice the microfluidics community has settled with using this material almost exclusively. However{,} for many applications PDMS is not an ideal material given its limited solvent resistance and hydrophobicity which makes it especially disadvantageous for certain cell-based assays. For these applications polystyrene (PS) would be a better choice. PS has been used in biology research and analytics for decades and numerous protocols have been developed and optimized for it. However{,} PS has not found widespread use in microfluidics mainly because{,} being a thermoplastic material{,} it is typically structured using industrial polymer replication techniques. This makes PS unsuitable for prototyping. In this paper{,} we introduce a new structuring method for PS which is compatible with soft lithography prototyping. We develop a liquid PS prepolymer which we term as {"}Liquid Polystyrene{"} (liqPS). liqPS is a viscous free-flowing liquid which can be cured by visible light exposure using soft replication templates{,} e.g.{,} made from PDMS. Using liqPS prototyping microfluidic systems in PS is as easy as prototyping microfluidic systems in PDMS. We demonstrate that cured liqPS is (chemically and physically) identical to commercial PS. Comparative studies on mouse fibroblasts L929 showed that liqPS cannot be distinguished from commercial PS in such experiments. Researchers can develop and optimize microfluidic structures using liqPS and soft lithography. Once the device is to be commercialized it can be manufactured using scalable industrial polymer replication techniques in PS - the material is the same in both cases. Therefore{,} liqPS effectively closes the gap between {"}microfluidic prototyping{"} and {"}industrial microfluidics{"} by providing a common material

Three-body non-additive forces between spin-polarized alkali atoms

Three-body non-additive forces in systems of three spin-polarized alkali atoms (Li, Na, K, Rb and Cs) are investigated using high-level ab initio calculations. The non-additive forces are found to be large, especially near the equilateral equilibrium geometries. For Li, they increase the three-atom potential well depth by a factor of 4 and reduce the equilibrium interatomic distance by 0.9 A. The non-additive forces originate principally from chemical bonding arising from sp mixing effects.Comment: 4 pages, 3 figures (in 5 files