Divorce Reform in Texas The Path of Reason SMU Law Review Volume 18 | Issue 1 Article 5 1964 Divorce Reform in Texas The Path of Reason William L Morrow Follow this and additional works at https //sch[.]
financial markets caused by Lehman’s fall led investors to focus on the dependence of CEE economies on external funding. Suddenly, the negative external positions of the banking sector of some economies in this region, such as Hungary and the Baltic countries – which international investors had up to then considered to be within an acceptable range – played an important role in increasing risk aversion toward the CEE region as a whole. In chart 1, this abrupt change in market sentiment is pictured by the magenta line, which clearly portrays the unprecedented rise of the implied volatility in the CEE-3 during this period of increased uncertainty. Given the liquidity shock triggered by the Lehman failure, it was feared that these countries would not be able to roll over their external (mainly short-term) debt. Moreover, real economic developments in the CEE-3 started to give signs of weakness, driven by these countries’ dependence on the macroeconomic development in the euro area, which deteriorated significantly as a consequence of the financialcrisis. The depreciation pressures that emerged also put the extent of FX lending in most CEE countries into the spotlight, except for the Czech Republic where FX lending has been less pronounced. Fears that depreciation would further increase the problems of the indebted private sector, already hit by the lack of external demand, accelerated the depreciating path, especially in the first two months of 2009.
Adverse effects of the global financialcrisis on international trade include falling demand, increased trade protectionism, and drying up of trade finance. Much attention has focused on the impact of the crisis on goods trade; however literature on its impact on services trade is limited, especially on the services trade in the People’s Republic of China (PRC). This paper analyzes the impact of the global financialcrisis on the PRC’s services trade, discusses policy responses by the government, and puts forward policy suggestions. The main findings of the paper are as follows: Although the global economic and financialcrisis spawned a synchronized recession leading to a contraction in the PRC’s services trade, the crisis has had a moderate effect on the PRC’s trade in services because of the lower internationalization of services. The PRC’s trade surplus in goods decreased and its trade deficit in services increased after the crisis. Structural reforms are now urgently needed to help support the recovery of output and trade. A possible solution to rebalancing the trade balance (trade surplus in goods and trade deficit in services) would be to expand trade in services. The degree of openness for services is lower than for goods in the PRC. Further liberalization in services trade is the appropriate policy choice for the government. Continued policy and regulatory reform in favor of services trade will be vital to supporting economic recovery . Improved market access and national treatment of foreign service suppliers would help enhance the productivity and competitiveness of local services firms and upgrade the industry structure of services, which is essential for the country’s economy to change from being driven by exports to being driven by domestic demand. Decreasing trade and investment barriers would help expand services trade and investment, and increase PRC involvement in the globalization of services.
Korea has experienced amazing growth since the 1960s, joining the OECD in 1996. However, the financialcrisis, which surfaced in 1997, has forced Korea to ask the IMF for a $57 billion bailout for the first time since the early 1980s. Although the contagion effect spread from the crisis in Southeast Asia, the root of the crisis was the failure of the Korean financial system. The highly regulated and uncompetitive banking system, imprudent provision of loans funded by short-term borrowing in the international market, and the lack of transparency in the accounting and management of financial institutions are all evidence of the structural problems of the Korean financial system which laid little change for more than thirty years until the crisis. Since the collapse of its financial system in 1997, the Korean government has begun an extensive economic program focused on macroeconomic stability and structural reform of the financial sector. Individual banks, too, have been carrying out efforts to restructure their management systems. This paper focuses on restructuring efforts in the Korean banking system and evaluates the progress and effectiveness of the reform.
Table 7 summarizes the core results from the present study. It also compares the results for Korea with those variables that help to explain attitudes towards introducing a market economy in Eastern Europe (Hayo, 2004). The only variable that has the same qualitative impact on market-based reforms in Korea and the creation of a market economy in Eastern Europe is the level of education. Thus, the factors influencing attitudes towards market-based reforms are quite different and conclusions based on the experience of transition in Eastern Europe may yield only limited or even misleading insights into economic policy reform in other parts of the world and vice versa. Our results underline the need for a broader analysis of public support for economic reforms, as the particular local circumstances appear to play an important role. Arguably, policy makers hoping to generate support for a particular economic reform strategy should not rely too much on this strand of the literature. At least in the present case, neither the variables put
The bank lending channel focuses on the effects of policy- induced actions on the supply of bank credit. Theories and models of the bank lending channel emphasize that if some of the borrowers are bank dependent (i.e. they do not have other forms of external financing) and bank loans are imperfect substitutes for other assets, monetary policy may operate through a bank lending channel. A monetary tightening decreases the supply of bank reserves reducing bank lending especially for banks that are dependent on deposits. Then, bank-dependent firms are forced to cut back their investment spending. The reduction in output following a monetary tightening results from financial market imperfections (Ireland, 2005).
As part of the government’s economic reform programme aimed at developing the financial and capital market, the Lusaka Stock Exchange (LuSE) was established in February 1994, with preparatory technical assistance from the International Finance Corporation (IFC) and the World Bank in 1993. Currently, 11 companies are listed. Among those, seven have been offerings on the back of Zambia’s privatisation programme, in which shares have been advertised to the Zambian public only. The Zambia Sugar Plc public offer, in late 1996, was the only exception in which shares were also offered to international investors, because the shares on offer were a combination of those warehoused by the Zambian Privatisation Trust Fund and those owned by the Commonwealth Development Corporation (CDC). Several incentives have been put in place to promote rapid development of the capital market in Zambia. These include the following: no exchange controls, no restrictions on shareholding levels, no restrictions on foreign ownership, no capital gains tax, and corporate income tax reduced to 30 per cent for companies listed on the LuSE.
Facilitated enrollment processes can also impact the integration of care delivery. Some states have seen this overlap and have used enrollment as a way to integrate care for their dual eligible population. Minnesota has adopted this approach, and has resulted in continuous care for their elderly dual population. Minnesota has aligned the administration within its capitated financial system so that Medicaid MCOs also qualify as Medicare Advantage D-SNPs. This approach would help North Carolina beneficiaries who may otherwise receive benefits through two different plans. Minnesota’s delivery of LTSS for elderly duals exists as one plan, with required care coordination, and because of this, has achieved an increase in administrative integration between Medicare and Medicaid. Texas, Tennessee, and Virginia similarly require contractors in Medicaid MLTSS programs to offer companion D-SNPs to cover Medicare services for their dually eligible beneficiaries. This has integrated care delivery between Medicare and Medicaid under one health plan.
Moreover, our results on short-term reversals of financial system structures show that a more balanced structure would enhance financial stability. This finding is especially true for emerging economies as they tend to be more dependent on banks and less dependent on stock markets. Our findings on this point are also supported by Laeven and Valencia (2011), who document that government bank recapitalization disproportionately supports firms dependent on external finance. However, we find that countries with well-developed stock markets, which we assume also have a well-developed banking sector, recover from the crises much faster than countries without these features. In our opinion, these results are important from a policy viewpoint and support the development of a balanced financial system structure. However, we also find that previous financial reforms do not impact the structure of the financial system after crises. This finding could indicate that financial regulations and reforms often cannot prevent financial crises and, furthermore, that the structure of the financial system reverts to its previous composition after a crisis. This conclusion is consistent with that of Beck et al. (2006), who study the impact of bank concentration and regulation on the likelihood of a country suffering a systemic banking crisis. The authors show that crises are less likely to occur when a country has a more concentrated banking system. However, the authors also find that regulatory policies might hinder competition, which might trigger greater bank instability.
With regard to neoliberalism, he neither held to the pure market ideology of a Margaret Thatcher, to whom he was initially compared by the British press, nor to her intransigence, given his willingness to negotiate deals, and the fact that those deals often undercut the substance of his pledged labor and social policy reforms. This said, Sarkozy did manage to institute a number of liberal- izing reforms in the social arena, although this came at great political cost to him, without necessarily much in the way of cost savings for the economy. Most notable was pension reform, debated and passed in fall 2010. The bill, which raised the minimum retirement age from 60 to 62 and from 65 to 67 for a full pension, was greeted by “days of protest” that brought millions into the streets for mass demonstrations and strikes—including at oil reﬁneries, which closed down 25 percent of gas stations in October. But although passage of the law in November was a major victory for Sarkozy, demonstrating the ineffec- tiveness of France’s labor unions, it did nothing for his political support. Nor did it do wonders for the economy, since the reform itself is little more than a stop-gap measure—without a new pension reform bill in 2018, France will face a deﬁcit of 100 billion euros by 2050. Moreover, a number of other policies meant to reform the labor markets were dropped, such as the proposal to create a “single labor contract” to ﬁx the insider/outsider problem, while his pledge to put public ﬁnances in order through cuts in public expenditure and debt could not be met. The big ﬁscal stimulus in 2008 on top of the tax reforms, such as creating the bouclier ﬁscale (ﬁscal shield) to cap at 50 percent the maximum tax payable by any individual (itself eliminated in 2011), also did nothing but increase the deﬁcit.
The imbalance in the number of institutions in combination with an outﬂow of capital gives rise to a situation where there is no mechanism to make rural ﬁnancial resources stay in rural areas or for urban ﬁnancial resources to ﬂow to rural areas. State-owned commercial banks are still an important channel for the outﬂow of rural funds (Feng et al. 2006; Wang 2009). In the rural areas of more central and western regions of the country, RCCs have become the only formal ﬁnancial institutions to provide ﬁnancial services for farm households and rural micro-en- terprises. Their monopolistic operations, however, do not encourage RCCs to increase efﬁciency. Even though the reform of postal savings has achieved outstanding results, the PSBC still has a limited number of credit businesses in rural areas. The apparent mismatch between supply and demand of rural ﬁnance is an underlying reason why the effective satisfaction rate of rural farm households' and SMEs' demand for ﬁnancial services is quite low (He 2004; Feng et al. 2006). The eco- nomic compensation mechanism for rural and agricultural risk is another underdeveloped area (Li et al. 2008).
Asia cannot be insulated from the impact of financial crises spawned elsewhere. The resilience of Asia’s banking systems can, in part, be attributed to the reforms implemented following the 1997/98 Asian financialcrisis. However, the risk-assessment capabilities of existing regulatory systems are clearly insufficient and must be supplemented in a way that reflects emerging new risks and challenges. With the crisis well into its second year, lessons drawn from recent events have led to specific reform proposals with concrete implementation plans in various global forums. Two major shortcomings in the modern global financial system are shaping an array of possible regulatory, supervisory, and prudential reforms. First, supervisors failed to stop excessive risk-taking and leveraging by financial institutions. Market failures, due in part to rapid financial innovation, discredited the regulatory model that relied on transparency, disclosure, and market discipline to curb inordinate risk-taking. Second, the absence of well-established crisis management mechanism, which was revealed in the failure to quickly address impaired financial institutions—both local and international, sapped confidence from the system.
The Stability and Growth Pact was revised in 2005 (see, for example, Morris et al., 2006) and a major overhaul of the EU’s fi scal framework is set to be approved in autumn 2011. An assessment of the envisaged reforms on the basis of the Kopits-Symansky criteria is presented in a table at the end of this box. In particular, the reforms would add some clarity, especially regarding the debt criterion and the adjustment path towards sound fi scal positions. As regards transparency, some attempts have been made, for example, to improve the statistical framework. In terms of simplicity, the envisaged reform of the Pact constitutes something of a backward step, since some of the new procedures and elements (such as the debt adjustment path and the expenditure benchmark) appear to be relatively complicated. It could be argued that the introduction of the European Semester, which aims to coordinate the monitoring of fi scal and macroeconomic- imbalances related policies, has made the fi scal framework more consistent with other policy objectives.
In the European Union there has been no similar sequence, and crisis management and legislative reform have both been continuous processes with overlapping consequences. Successive rounds of stress tests were completed in September 2009, July 2010, and July 2011, but have not resulted in the return of trust in the European banking sector. And from late 2009 onwards the difficulty has been compounded by sovereign credit fragility affecting first Greece and then Ireland, Portugal, Spain, Italy, and others. Simultaneously, the European Commission’s Internal Market Directorate-General (DG MARKT), which oversees financial regulation at the EU level, has actively proposed new legislation in multiple areas: capital requirements (proposed in October 2008, adopted in various steps in 2009), deposit insurance (proposed in October 2008, adopted in March 2009), rating agencies (proposed in November 2008, adopted in November 2009), hedge funds and private equity (proposed in April 2009, adopted in June 2011), revision of capital requirements (proposed in July 2009, adopted in November 2010), new EU-level supervisory authorities (proposed in September 2009, adopted in November 2010), revision of credit rating agencies (proposed in June 2010, adopted in May 2011), revision of deposit insurance (proposed in July 2010, discussion ongoing), market infrastructure (proposed in September 2010, discussion ongoing), revision of capital requirements (proposed in July 2011), revision of the 2004 directive on markets in financial instruments (proposed in October 2011), revision of 2003 directive on market abuse (proposed October 2011), another revision of credit rating agencies (proposed November 2011), and framework for bank crisis management and resolution (forthcoming), to name only the most prominent pieces. Inevitably, the fact that so many different pieces of legislation are debated and decided upon while the financialcrisis continues raises risks of legislative inconsistency and of short-term considerations prevailing over longer term ones.
Some of us who have been pushing for more substantial IMF reform, in particular in the area of governance and legitimacy, take the view enunciated by Rahm Emanuel: “You don’t ever want a crisis to go to waste; it’s an opportunity to do important things that you would otherwise avoid.” I will return to this theme when I outline my proposals, but first let’s consider the crisis itself and the potential role of the IMF in cushioning its impacts. How the IMF handles the current global financialcrisis will affect its future and support for it by the United States and other members.
of the central bank. On the other, however, we must consider that the conversion of debt from Euro into a national devalued currency would produce effects similar to the default, with a probable wave of bank failures, with vast international consequences. 6 In our opinion, it would be better to increase the taxation on wealth (that a minority of the population has accumulated in recent decades) to stabilise the debt/GDP ratio over the medium term, mainly through an increase in its denominator. As regards in particular Europe, this should be part of an economic policy based on a common project of public intervention. In other words, the sustainability of public finances in the Euro area would be ensured by the “credibility” of the political change at the base of a new direction for economic development, with the crucial support of the central bank. In this perspective, government bailouts should be done as “nationalisations” or participation to the capital in proportion to the intervention implemented, in a context where (also for the Euro area, with a change in the political and institutional situation) the central banks play an active role as lenders of last resort in support of governments (De Grauwe, 2011). This strategy, however, would be incomplete if the public sector, thanks to a direct management of the credit or a sharing of banking decisions too, did not play the necessary role of engine of a new development phase, creating the basis for new profit opportunities for private capital, in a perspective of public-private collaboration. The increased profitability would then divert the attention of the capital from profits obtainable from the privatisation of common goods (water, education, culture, etc.) and by financial speculation, which should be limited through a revision in the regulation of credit and financial markets, challenging the primacy given to the financial liquidity and changing those rules that have triggered a severe financialcrisis (Orléan, 2009). In particular, the public sector should promote investments in labour intensive sectors (education, research, healthcare, services, etc.) – reversing the trend which is instead characterising the evolution of the current crisis – and those linked to green technologies and energy saving.