July 7, 2008
Uncategorized
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The Cost of Equity in Canada: An International Comparison
This paper calculates an implied cost of equity for 19 developed countries from 1991 to 2006. During this period, there has been a decline in the cost of equity of about 10-15 bps per year, which can be partially attributed to declining government yields and declining inflation. -
The Effect of the Sarbanes-Oxley Act on CEO Pay for Luck
According to the rent-extraction hypothesis, weak corporate governance allows entrenched CEOs to capture the pay-setting process and benefit from events outside of their control – get paid for luck. -
June 27, 2008
Flexibility versus Credibility in Inflation-Targeting Frameworks
There are two broad classes of arguments for greater flexibility in the design and application of monetary policy frameworks. The BIS has done a great deal of useful work on asset-price targeting in particular and on the complicated interplay between monetary policy and financial stability in general. -
June 25, 2008
United States Treasury Securities Accepted as Collateral for the Bank of Canada's Standing Liquidity Facility
Further to its 12 December 2007 announcement, the Bank of Canada is expanding the list of securities eligible to be pledged as collateral for the Standing Liquidity Facility to include marketable securities issued by the United States Treasury (bills, notes and bonds, including Treasury Inflation-Protected Securities). -
June 23, 2008
Real Estate, Mortgage Markets, and Monetary Policy
For many Canadians, one of the most important investments they'll make is the purchase of a house. And for you as financial market professionals, the links between the housing market and financial markets have important consequences. -
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June 21, 2008
Financial Market Turmoil and Central Bank Intervention
In this article, we consider central bank intervention to address financial market turmoil with a focus on the questions of why, when, and how a central bank might intervene. We set out a policy framework and identify appropriate central bank instruments to respond to extraordinary financial market turmoil, consistent with central bank policy goals and functions. -