Can You Map Global Financial Stability?

Puig, Jaume; Miyajima, Ken; McCaughrin, Rebecca; Dattels, Peter

doi:10.5089/9781455201280.001

Cited by 11 publications

(1 citation statement)

References 13 publications

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“…A long-term imbalance of an economy results in a high risk of outbreak of a crisis, and in case of the EU this poses a danger to the stability of its entire whole structure, which was proven by the events of the years 2007(Puig 2010, (Global Development Finance 2012, p. 2). This is why it is crucial to monitor the EU Member States' economic balance (Smaga 2014), (Sporek 2010, p.102).…”

Section: The Issue Of Macroeconomic Balance Within the Eumentioning

confidence: 99%

Evaluation Of The Macroeconomic Stability Of Central And Eastern European Countries With A View Toward Their Membership In The European Union. Multidimensional Risk Analysis

Pera

2016

CER

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The economies of European countries have been undergoing constant turbulence for several years. This is the consequence of a range of factors, in particular: the 2007 crisis; violations of the convergence criteria and fiscal discipline; problems with the liquidity of international financial markets; depreciation of the euro currency; increasing unemployment in European Union Member States; the slow increase in productivity in the majority of EU economies; growing indebtedness of public finance sectors; problems with retirement schemes – in particular with correlation between their effectiveness and unemployment and low rate of natural increase. Thus, the author posits that it is important to analyse the key aspects related to these economic parameters which may affect this process in a significant way and decide the risk of its occurrence. This is the assumed aim of this work. The work shows the results of the author’s own study, carried out with the use of different methods, such as the macroeconomic stabilisation pentagon, the Scoreboard, and Spearman's rank correlation coefficient. The variety of test methods employed results on one hand from the problem's complexity, and on the other from a profound analysis of all dependencies and risks resulting from this complexity. The conducted study shows that there is a significant correlation between the Scoreboard parameter imbalances and the intensity of crisis phenomena in case of violations of the acceptable thresholds in terms of current account balance, net international investment position, export market shares, nominal unit labour costs, real house prices, private sector debt, government debt, and the unemployment rate. The imbalances of these eight indicators may form an adverse macroeconomic environment favouring the occurrence of intense crisis phenomena, which means that they should be subject to special monitoring. The shapes of the macroeconomic stabilisation pentagon for CEEC economies in 2014 shows that none of the analysed countries is characterised by total filling of the pentagon. This means that the economic situation in these countries is not stable and requires constant monitoring. The figures related to all analysed indicators, apart from GDP, are characterised by a flattened shape, which is characteristic for such a situation.

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Section: The Issue Of Macroeconomic Balance Within the Eumentioning

confidence: 99%

Evaluation Of The Macroeconomic Stability Of Central And Eastern European Countries With A View Toward Their Membership In The European Union. Multidimensional Risk Analysis

Pera

2016

CER

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Visual Macroprudential Surveillance of Banks

Sarlin

2016

Intell. Sys. Acc. Fin. Mgmt.

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Summary We create a tool for visual surveillance of the European banking system from a macroprudential perspective. The tool performs visual dynamic clustering with the self‐organizing time map (SOTM) to visualize evolving multivariate data from two viewpoints: (i) multivariate cluster structures, and (ii) univariate drivers of changes in structures. In assessing the European banking system, the main tasks the SOTM can be used for are (i) identifying structural changes and breaking points in a large number of risk indicators, and their specific location in the cross‐section, and (ii) identifying the build‐up of, or generally changes in, individual risk indicators in the banking system as a whole. While the former view provides indications of changes in the banking system, the latter describes the sources of these changes. Copyright © 2016 John Wiley & Sons, Ltd.

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Introduction

Sarlin

2014

Computational Risk Management

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Can You Map Global Financial Stability?

Cited by 11 publications

References 13 publications

Evaluation Of The Macroeconomic Stability Of Central And Eastern European Countries With A View Toward Their Membership In The European Union. Multidimensional Risk Analysis

Evaluation Of The Macroeconomic Stability Of Central And Eastern European Countries With A View Toward Their Membership In The European Union. Multidimensional Risk Analysis

Visual Macroprudential Surveillance of Banks

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