The training will touch upon the technical framework for contingent capital and bail in debt and the different choices made by the European legislator as compared to other regulators throughout the world. A comparison is made of different bail in regimes in Europe as well, in order to explore the common ground and the differences in the applicable regimes. In addition to the analysis from a legal perspective, an elaborate discussion will be presented about the first market developments in respect of contingent capital and bail in debt, effects on pricing and the different rationale for investors taking positions in contingent capital and bail in debt.
The course will consider alternative macroeconomic frameworks with financial frictions to under-stand financial crisis, business cycles and public policy. There will be an brief historical overview of financial crises and basic financial accelerator models which emphasizes the interaction between borrowing constraint, asset price and aggregate production.
It will then be introduced liquidity constraint to examine the business cycles and monetary policy. Finally, the course will present financial intermediaries and government to study banking crisis, credit policy and macro prudential policy. By developing these frameworks, the training aims to understand the recent financial crisis and the roles of public policies.