on 2023/07/21 by alex1, []

Strategies adopted by banks to at least partially evade supervision by the relevant supervisory authority by exploiting legal loopholes or by relocating operations to faraway foreign countries. Reasons for avoidance can be, above all, – secrecy of prohibited business practices, – lack of confidence in the activities of the supervisory authority, and here above all […]

on 2023/07/21 by alex1, []

If the exchange rate of a currency, e.g. the EUR, rises against another currency such as the USD, the INR, this results in unfavorable and favorable effects for the currency area affected by the revaluation, which are difficult to calculate in advance – if there is a close trade connection or – if invoicing in […]

on 2023/07/21 by alex1, []

Unless otherwise defined, the risk of systemic risk arising from the transmission of difficulties at a failing institution to other banks and to the financial market as a whole. – Direct contagion effects arise as a result of contractual relationships with insolvent institutions. They necessitate write-downs on receivables from the insolvent institution, or there is […]

on 2023/07/21 by alex1, []

Money appropriated (by a public treasury; by a bank) may only be used for the purpose for which the payment was made. Use for other purposes is not permitted. – See earmarking. Attention: The financial encyclopedia is protected by copyright and may only be used for private purposes without express consent! University Professor Dr. Gerhard […]

on 2023/07/21 by alex1, []

At the ECB, the three variables – collectively agreed wages, – total hourly labor costs and – compensation per employee. In the respective Monthly Bulletin, the corresponding values are shown comparatively in the text section („Prices and costs“) and discussed by the ECB within the framework of the two-pillar principle. – See compensation of employees […]

on 2023/07/21 by alex1, []

Expression of the ability of the labor market in an economy (labor market; place where labor is offered and demanded in units of time) to adjust to rising (falling) demand for labor services with an increase in supply, such as overtime, or a decrease in supply, such as short-time work. Evidence shows that high labor […]

on 2023/07/21 by alex1, []

A term used in forestry (pruning = removal of lower branches to provide clearance and to get a knot-free tree trunk) that entered financial language after 1980; here it means the removal of excess items from a budget or the layoff (the term „layoff“ shall be avoided as much as possible for it is full […]

on 2023/07/21 by alex1, []

Unless otherwise defined, this refers to purchases of securities on the secondary market by a central bank, which thus indirectly finances the government. – In the wake of the Greek crisis, for example, the ECB began purchasing government bonds of euro area member states that had fallen very sharply in price (Securities Markets Program, SMP) […]

on 2023/07/21 by alex1, []

In the context of financial markets, supervision by supervisory authorities established by law. The primary objective of supervision is to ensure the functioning and stability of the financial sector by protecting creditors while observing market principles. – The benefits of supervision must be set against its costs, because supervision ties up scarce resources both on […]

on 2023/07/21 by alex1, []

It must be ensured that a member of the supervisory board in a company in the financial sector is knowledgeable and reliable. This is because it has been shown in many failures and bankruptcies that the members of the relevant institution have proved incapable of monitoring the management of the board of directors. The supervisory […]