Zombie banks - 1779 Words

What are ‘zombie banks’ The term ‘zombie bank’ was first introduced by Edward Kane in 1987 to describe a bank that has a negative net worth but still continues to operate. A negative net worth means that the fair value of assets is lower than the total value of liabilities. Zombie banks usually have large amounts of non-performing assets on their balance sheets making them unprofitable. A loan is considered to be a non-performing asset if no principal payments or interest have been paid for 90 days and is therefore seen to be in jeopardy of default. The fair value of an asset that is considered non-performing is considerably reduced. Zombie banks usually continue to operate until their financial situation is resolved or they are run†¦show more content†¦As a result, Japan went into a prolonged period of deflation that lasted for most of the 1990’s. In order to boost demand, the Japanese government took a Keynesian approach and went through 10 fiscal stimulus packages in 1990â₠¬â„¢s totaling over 100 trillion yen (10). However, this didn’t have the desired effect on demand because of deflation. Consumers were putting-off purchase decisions because prices were falling. The real GDP stagnated and average growth between 1990 and 2001 was only 0.37% (12). The European debt crisis began in 2009 when rating agency’s downgraded Greek government and bank debt because Greece’s government debt reached 113% of GDP. Furthermore, in 2010 Greece’s budget deficit for 2009 was revised from 3.7% to 12.7% (13). Since then Greece has received multiple bail-outs and the crisis has spread throughout the Eurozone and many countries like Portugal, Spain, Ireland and Italy have been severely affected. The Eurozone crisis is a combination of sovereign debt, productivity, private debt, asset bubble and banking crisis. Contrary to BOJ in 1990’s, the ECB reacted to the crisis by quickly lowering the interest rate to 1% in May 2009 (14). Furthermore, the ECB started intervening with the securities market directly in 2010 with the ’Securities Markets Programme’, purchase programme to buy bank-issued covered bonds (2011)Show MoreRelatedCulture of Consumerism, Gender Roles, and Violence in Romero’s Night of the Li ving Dead and Boyle’s 28 Days Later 2773 Words   |  11 Pagescontrols the host like in zombie films, but rather a virus that unleashes the rage all humans pertain. In 28 Days Later, we witness Boyle’s â€Å"infected† killing the population. Are these â€Å"infected† zombies? To understand the term zombies, we must first look at the history of the zombie genre in film history. George Romero’s Night of the Living Dead (1968) was not the first zombie feature to be created. Many believe the zombie genre began with Victor Halperin’s White Zombie (1932). The differenceRead MoreInside the Meltdown49737 Words   |  199 Pagesabout public confidence. That s how we maintain the stability with people having confidence in our brand and our insurance guarantee, and I think we ve done that fairly successfully. We have seen a lot of stability. People are keeping their money in banks, which is good. ... I think we ll be judged by how history judges us, whether we continue to be effective in trying to stabilize the banking sector and maintaining people s confidence in the banking system. ... You say in speeches that the FDICRead MoreChina Related Market Events Overwhelm The Fed1814 Words   |  8 PagesFed? The Chairman of the Federal Open Market Committee (FOMC), William Dudley, appeared last week to virtually rule out any chance of an increase in the federal funds target at the 16-17 September policy meeting. As President of the Federal Reserve Bank of New York, he is probably the best qualified member of the FOMC to understand the implications of tightening US financial conditions. That having been said, Mr Dudley was careful not to entirely rule out the case for normalisation, depending on incomingRead MoreChina Related Market Events Confuse The Fed?1838 Words   |  8 PagesFed? The Chairman of the Federal Open Market Committee (FOMC), William Dudley, appeared last week to virtually rule out any chance of an increase in the federal funds target at the 16-17 September policy meeting. As President of the Federal Reserve Bank of New York, he is probably the best qualified member of the FOMC to understand the implications of tightening US financial conditions. That having been said, Mr Dudley was careful not to entirely rule out the case for normalisation, depending on incomingRead MoreZombie Industry : Zombie Lending And Depressed Restructuring856 Words   |  4 Pagesis â€Å"Zombie lending and depressed restructuring†. The lax misleading supervisions of the banking system were extremely serious, but the Japanese government not takes any measure to stop lending money to zombie firms. Zombie firms are defined as firms are low on production and profit should exit the market but still continue the business by government’s support. They kept recr uit labor supposed be work in regular firms lead to decreasing of production. When the assets price falls, most banks lossesRead MoreTypes Of Attacks On A Computer System1546 Words   |  7 Pagesused in a following attack to gain unauthorized access to a system or network. Phishing attack - In this attack, attacker uses social engineering techniques to steal confidential information - the most common purpose of such attack aims user s bank details. This kind of attacks mostly use schemes involving spoofed emails that send to users to lead those infected websites designed to appear as real on-line banking websites which are malicious. Users get emails will look authentic sent from sourcesRead MoreThe And Of The Basement1720 Words   |  7 PagesWe hoped to push the zombie down the stairwell; and, if we were lucky, that would create the necessary trauma to the brain area to cause permanent death. The needs of the many outweigh the needs of the few, said Tim stoically with a knowing grin. Or the one, added Dean. I had no idea what they were talking about. As the door swung out, we lunged into the breach. The stairs before us were empty. We could hear muffled sounds from the kitchen. Here zombie, zombie, zombie... Dean called out,Read MoreMovie Analysis : Film And Film870 Words   |  4 Pagesprovoke laughter, exaggerating situations, language, action, drama, relationships and characters. Could also include slapsticks, parody, romantic comedies. †¢ Crime and Gangster: These are designed around actions of criminals and mobsters, practically bank robbers, young teenagers, operating outside the law, stealing and murdering their way through life. †¢ Drama: Dramas portray real life characters, settings, life and situations, stories including character development. Not focused on special effectsRead MoreFinancing Of The Japanese System898 Words   |  4 Pagesstability, and the company had access to well trained-sector specific workers. However, the increase in financing in Japan, and the emphasize on long-term employment, had a negative effect on the economic system as a whole, through the creation of zombie companies that only served to drain the economy, rather than protect labor relations (Edgington 2009; Yamamura and Streeck 2003). As a result, it seems that while financing could make companies more efficient, it also could lead to job loss and wageRead MoreEssay about Japanese Malaise793 Words   |  4 Pagesnominal interest rates and the emergence of the liquidity trap. According to Hayashi Prescott (2002), a major contribution to the productivity slowdown is that Japanese banks conceal their non-performing loans from inefficient firms by discounting lending rates regardless of the little likelihood of being recovered. As the result, banks restrain from providing the capital necessary for firms to adapt to changes through investment and the introduction of more productive technologies. Microeconomic theory