http://dukeresearchadvantage.com/charvey/2009/01/24/the-essential-need-for-transparency/ Research that Matters Thu, 27 May 2010 07:41:08 +0000 http://wordpress.org/?v=2.9.2 hourly 1 http://dukeresearchadvantage.com/charvey/2009/01/24/the-essential-need-for-transparency/comment-page-1/#comment-188 Cam Mon, 26 Jan 2009 22:20:43 +0000 http://dukeresearchadvantage.com/?p=632#comment-188 I have a previous post on the sources of volatility which is related to your comment. In economics lingo, this is considered "uncertainty". For example, you can look at some specific risk metric for a bank -- and call that the "risk". However, you have no confidence in the numbers that go into the risk metric. This is called "uncertainty". Investors care about uncertainty and this pushes up risk premia -- just as you say. Also see my posting on the Shroud of Citigroup.<div class="comment-remix-meta"><a href="#" class="quote" onclick="quote('188','Cam','I have a previous post on the sources of volatility which is related to your comment. In economics lingo, this is considered \"uncertainty\". For example, you can look at some specific risk metric for a bank -- and call that the \"risk\". However, you have no confidence in the numbers that go into the risk metric. This is called \"uncertainty\". Investors care about uncertainty and this pushes up risk premia -- just as you say. Also see my posting on the Shroud of Citigroup.'); return false;">Quote</a></div> I have a previous post on the sources of volatility which is related to your comment. In economics lingo, this is considered “uncertainty”. For example, you can look at some specific risk metric for a bank — and call that the “risk”. However, you have no confidence in the numbers that go into the risk metric. This is called “uncertainty”. Investors care about uncertainty and this pushes up risk premia — just as you say. Also see my posting on the Shroud of Citigroup.

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]]> http://dukeresearchadvantage.com/charvey/2009/01/24/the-essential-need-for-transparency/comment-page-1/#comment-187 Evren Mon, 26 Jan 2009 21:48:47 +0000 http://dukeresearchadvantage.com/?p=632#comment-187 This may explain the persistence in the recent financial crisis to some extent. The risk premium is still high because of the defensive behaviours of financial institutions: they are not sure about the lost of the other ones. The elevated spreades will continue as long as the real demage has not been uncovered and as long as it is known by public<div class="comment-remix-meta"><a href="#" class="quote" onclick="quote('187','Evren','This may explain the persistence in the recent financial crisis to some extent. The risk premium is still high because of the defensive behaviours of financial institutions: they are not sure about the lost of the other ones. The elevated spreades will continue as long as the real demage has not been uncovered and as long as it is known by public'); return false;">Quote</a></div> This may explain the persistence in the recent financial crisis to some extent. The risk premium is still high because of the defensive behaviours of financial institutions: they are not sure about the lost of the other ones. The elevated spreades will continue as long as the real demage has not been uncovered and as long as it is known by public

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]]> http://dukeresearchadvantage.com/charvey/2009/01/24/the-essential-need-for-transparency/comment-page-1/#comment-186 Evren Caglar Mon, 26 Jan 2009 21:38:47 +0000 http://dukeresearchadvantage.com/?p=632#comment-186 This may explain the persistence in the recent crisis to some extent. The risk premium is still high because of the defensive behaviors of financial institutions: they are not sure about the lost of the other ones. It seems the elevated spreads will continue as long as the real damage has not been uncovered and it is known by public.<div class="comment-remix-meta"><a href="#" class="quote" onclick="quote('186','Evren Caglar','This may explain the persistence in the recent crisis to some extent. The risk premium is still high because of the defensive behaviors of financial institutions: they are not sure about the lost of the other ones. It seems the elevated spreads will continue as long as the real damage has not been uncovered and it is known by public.'); return false;">Quote</a></div> This may explain the persistence in the recent crisis to some extent. The risk premium is still high because of the defensive behaviors of financial institutions: they are not sure about the lost of the other ones. It seems the elevated spreads will continue as long as the real damage has not been uncovered and it is known by public.

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