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Daily Archives: July 17, 2013

BIS – Relationship and Transaction Lending in a Crisis

Relationship and Transaction Lending in a Crisis by Patrick Bolton, Xavier Freixas, Leonardo Gambacorta and Paolo Emilio Mistrulli, Working Papers No 417 -July 2013

“We study how relationship lending and transaction lending vary over the business cycle. We develop a model in which relationship banks gather information on their borrowers, which allows them to provide loans for profitable firms during a crisis. Due to the services they provide, operating costs of relationship-banks are higher than those of transaction-banks. In our model, where relationship-banks compete with transaction-banks, a key result is that relationship-banks charge a higher intermediation spread in normal times, but offer continuation-lending at more favorable terms than transaction banks to profitable firms in a crisis. Using detailed credit register information for Italian banks before and after the Lehman Brothers’ default, we are able to study how relationship and transaction-banks responded to the crisis and we test existing theories of relationship banking. Our empirical analysis confirms the basic prediction of the model that relationship banks charged a higher spread before the crisis, offered more favorable continuation-lending terms in response to the crisis, and suffered fewer defaults, thus confirming the informational advantage of relationship banking.”

CFPB: Student debt swells, federal loans now top a trillion

Rohit Chopra is the CFPB’s Student Loan Ombudsman. This post is excerpted from prepared remarks before a conference hosted by the Center for American Progress on July 17, 2013, in Washington, DC. “While there has been considerable attention by policymakers on federal student loan interest rates taken out for the 2013-2014 academic year, outstanding studentContinue Reading

EPIC: Working Group Rejects Industry Do Not Track Proposal

“The World Wide Web Consortium has rejected a Do Not Track standard proposed by the online advertising industry. The industry proposal would have allowed advertising companies to continue to collect data about the browsing activities of consumers, but would have limited the way companies could characterize users based on that data. The group stated thatContinue Reading

Federal Reserve Board – Beige Book – July 17, 2013

Summary of Commentary on Current Economic Conditions by Federal Reserve District, July 17, 2013 “Reports from the twelve Federal Reserve Districts indicate that overall economic activity continued to increase at a modest to moderate pace since the previous survey. Manufacturing expanded in most Districts since the previous report, with many Districts reporting increases in newContinue Reading

New GAO Reports: DHS, DOD’s POW/MIA Mission, Fewer Power Plants, Affordable Care Act, Bureau of Prisions

Department of Homeland Security – Oversight and Coordination of Research and Development Efforts Could Be Strengthened, GAO-13-766T, Jul 17, 2013 DOD’s POW/MIA Mission – Top-Level Leadership Attention Needed to Resolve Longstanding Challenges in Accounting for Missing Persons from Past Conflicts, GAO-13-619, Jul 17, 2013 Federal Printing – Fewer Plants Are in Operation Than in 1990,Continue Reading

New Preservation Metadata

“OCLC Research Scientist Brian Lavoie and Richard Gartner from King’s College London co-authored this second edition of Preservation Metadata, which focuses on new developments in preservation metadata made possible by the emergence of PREMIS as a de facto international standard. The complete report is available from the Digital Preservation Coalition website – it will be of interestContinue Reading

Cyber-crime, securities markets and systemic risk

Cyber-crime, securities markets and systemic risk. Joint Staff Working Paper of the IOSCO Research Department and World Federation of Exchanges. Author: Rohini Tendulkar (IOSCO Research Department). Survey: Grégoire Naacke (World Federation of Exchanges Office) and Rohini Tendulkar. “This report and survey is intended as part of a series exploring perspectives and experiences with cyber-crime acrossContinue Reading

Liquified Natural Gas: Why Rapid Approval of the Backlog of Export Applications is Important for U.S. Prosperity

Margo Thorning, Ph.D. Senior Vice President and Chief Economist, American Council for Capital Formation: “Another macroeconomic analysis by ICF International finds that expanded LNG exports would spur significant gains in nationwide employment, GDP and federal tax receipts. The net effects on U.S. employment are anticipated to be positive with net job growth of between 73,100Continue Reading

ACLU – Police Documents on License Plate Scanners Reveal Mass Tracking

By Catherine Crump, Staff Attorney, ACLU Speech, Privacy and Technology Project: “Automatic license plate readers are the most widespread location tracking technology you’ve probably never heard of. Mounted on patrol cars or stationary objects like bridges, they snap photos of every passing car, recording their plate numbers, times, and locations. At first the captured plateContinue Reading

McKinsey – Five opportunities for US growth and renewal

Game changers: Five opportunities for US growth and renewal: “The US economy is struggling to find a new formula for vigorous growth. But all growth opportunities are not created equal. A new report from the McKinsey Global Institute pinpoints five catalysts—in energy, trade, technology, infrastructure, and talent development—that can quickly create jobs and deliver aContinue Reading

Microsoft – Responding to government legal demands for customer data

Posted by Brad Smith General Counsel & Executive Vice President, Legal & Corporate Affairs, Microsoft “[July 16, 2013] we have asked the Attorney General of the United States to personally take action to permit Microsoft and other companies to share publicly more complete information about how we handle national security requests for customer information. WeContinue Reading