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SUMMARY:Whatever it takes: The Real Effects of Unconventional Monetary Pol
 icy
DTSTART:20160623T103000
DTEND:20160623T120000
DTSTAMP:20260429T060613Z
UID:0cab933264bee504df560bc4cdc1d56736318acc3f7d361e021de1f6
CATEGORIES:Conferences - Seminars
DESCRIPTION:Viral ACHARYA (NYU)\nOn July 26\, 2012 the ECB’s president M
 ario Draghi announced to do “whatever it takes” to preserve the Euro a
 nd subsequently launched the Outright Monetary Transactions (OMT) Program\
 , which led to a significant increase in the value of sovereign bonds issu
 ed by European periphery countries. As a result\, the OMT announcement ind
 irectly recapitalized periphery country banks due to their significant hol
 dings of these bonds. However\, the regained stability of the European ban
 king sector has not fully transferred into economic growth. We show that t
 his development can at least partially explained by zombie lending motives
  of banks that still remained undercapitalized after the OMT announcement.
  While banks that benefited from the announcement increased their overall 
 loan supply\, this supply was mostly targeted towards low-quality firms wi
 th pre-existing lending relationships with these banks. As a result\, ther
 e was no positive impact on real economic activity like employment or inve
 stment. Instead\, these firms mainly used the newly acquired funds to buil
 d up cash reserves. Finally\, we document that creditworthy firms in indus
 tries with a prevalence of zombie firms suffered significantly from the cr
 edit misallocation\, which slowed down the economic recovery.
LOCATION:UNIL\, Extranef\, room 126 https://planete.unil.ch/plan/?local=EX
 T-126
STATUS:CONFIRMED
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