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Debt spiral of an individual entrepreneur and possibilities of its solution on the example of a case study
KURÁŽOVÁ, Eliška
This bachelor thesis examines the causes, course and current financial crisis of an individual entrepreneur caused by a debt spiral. The theoretical part focuses on debt and indebtedness, which is one of the causes of poverty. It describes the debt spiral, its causes, prevention and solutions. It examines the role of institutions and personal bankers in resolving the debt spiral, the legal circumstances of debt relief and personal bankruptcy. These theoretical findings are applied to a case study that deals with a specific debt situation. In cooperation with an indebted businesswoman, it solves her financial situation. The work focuses on compiling a private budget that stabilizes the current situation. The aim of this work is to propose a solution of the debt spiral, to describe the course of the solution and to evaluate the results of the proposed solutions. The research method is a case study. Two types of questionnaires are used in this case study. The interview is further developed from the facts that emerged from the answers to the questions in the questionnaires.
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Ideal Crisis Management Mechanism for Credit Institutions and Investment Firms in the European Union
Kropjok, Vít ; Kohajda, Michael (referee)
Ideal Crisis Management Mechanism for Credit Institutions and Investment Firms in the European Union Abstract: The 2007-8 financial crisis brought about the most severe economic contraction since the Great Depression. Regulators on both sides of the Atlantic were taken aback and soon realized that they had no tools to deal with distressed banks and other financial services firms, failure of which could undermine financial stability not only within individual states, but also on a global scale. As a result, central banks of in particular the United States and the Eurozone became the most important actors in the fight against the unfolding crisis and de facto the only "governmental agencies" capable of swift and decisive measures. Their timely and vigorous reaction most likely warded off the collapse of the global financial system, though it was not without controversies. These controversies are analyzed in this dissertation in order to find out what role should central bank have during financial crisis. Governments followed central banks with massive bank bailouts. In many countries, governments went beyond liquidity provision and nationalized their banks, which threatened their own solvency. Although the global financial system has been largely restored in the last decade, it has been achieved at huge...
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Mass Privatisation and Privatised Firms' Performance in the Post-Privatisation Era: Empirical Evidence from the Czech Republic, Poland, and the Slovak Republic
Wang, Yanyi ; Szobi, Pavel (advisor) ; Akdogan, Idil (referee) ; Čech, František (referee)
This study used panel data on 25 privatised firms from the Czech Republic, Poland, and Slovakia from 2000 to 2019 to explore the impact of different MPS on firm performance in the post-privatisation era. This paper then explored two main research questions: 1) The 2008 financial crisis presented problems for corporations with different governance models. How did firms built utilising various MPS models perform differently across the three countries in this context? 2) What factors would affect the performance of privatised firms in the post-privatisation era? Additionally, this study first used the Wilcoxon signed rank test to analyse six performance variables for the sample firms for eight years before and after 2008. The researcher then chose the corporate governance index (GOV) and shareholder return (ROSF) as the main explanatory variables and did a random effects regression analysis of privatised firm performance. Finally, the paper had two main findings: 1) The financial crisis had a more significant impact on the Czech Republic and Slovakia but had a more negligible influence on Poland. 2) During the post-privatisation era, GOV did not distinctly affect privatised company performance, while ROSF had a more substantial explanatory power for performance based on market development and policy...
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Can a Dual-beta Five-Factor Model Explain Stock Market Variation in CEE?
Lu, Shuhong ; Čech, František (advisor) ; Chondrogiannis, Ilias (referee) ; Paulus, Michal (referee)
The study applies a dual-beta five-factor model to investigate how return is correlated with market factor, size, value, profitability and investment factors in the CEE region. Dual betas are employed in a pooled regression to account for different behaviour in different market conditions. The results show that market factor is significant across the sample period from 2003 to 2017, and the coefficient of the market factor is lower in bearish market and higher in bullish market. By employing dual betas, the explanatory power of a model has increased. However, the effect is limited, and we do not recommend using the dual-beta model due to the loss of simplicity. Post-regression diagnosis has confirmed the appropriateness of using our model by checking the key assumptions of Ordinary Least Square. Limitations are presented at the end to suggest future study.
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Natural Gas Comovement with Other Commodity Markets - A Wavelet Analysis
Otradovec, Michal ; Gutiérrez Chvalkovská, Jana (advisor) ; Kraicová, Lucie (referee)
This thesis studies the impact of shale gas on commodity and stock markets in the U.S. by employing wavelet approach and conducting a time-frequency analysis of dynamic correlations between natural gas and important representatives of commodity markets: crude oil, coal, corn, wheat, and several indices. It covers the period from 2006 to 2015 and is performed on daily data. Our thesis enlarges existing literature on comovement between natural gas with other energy commodities and stocks using wavelet coherence - a methodology which allows analyzing comovement among assets not only from a time series perspective but also over different frequencies. Financialization of natural gas and its involvement in investment portfolios under changing conditions on the U.S. gas market provide space for examination of gas proper correlation estimates in respect to other financial assets. Our results reveal natural gas comovement behaviour with examined commodities during the Financial Crisis. They show gradual decoupling between gas and crude oil prices in time. To the best of our knowledge we are the first to address natural gas using wavelet coherence in connection to agricultural commodities corn and wheat. These commodities together with natural gas are primary sources for bioethanol production being used in...
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Comparison of the Market Regulation in the EU and in the USA in the Context of Economic Crisis
Beránek, Jaromír ; Hraba, Zdeněk (advisor) ; Borkovec, Aleš (referee)
Jaromír Beránek - Comparison of the Market Regulation in the EU and in the USA in the Context of Economic Crisis Abstract: Once the U.S. real estate bubble burst in 2007 and most of the major American banks ran into a financial distress following the rising number of mortgage defaults, few foresaw that these problems would grow into the biggest global crisis since 1930s. Soon it turned out that the fall was inevitable. Due to the lack of regulation an uncontrolled growth in bad credits occurred over the years preceding the crisis outbreak. Financial institutions, silently supported by credit rating agencies, started pushing complicated and opaque investment instruments into the hungry market, and investors gladly bought them, motivated by the promise of high bonuses. The ongoing process of globalization and international linking of financial markets significantly accelerated the evolvement of the crisis and contributed to its spread around the world. Burdened by the immense costs of bank bailouts governments of many countries faced a threat of an imminent bankruptcy, and were forced to seek international aid. In the EU, the USA and on the international scene, several initiatives arose, striving to create effective regulatory reforms and to strengthen tools for a timely identification and prevention of...
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Impacts of European Bailout Programs on SMEs Distress rate
Tóthová, Simona ; Parrák, Radovan (advisor) ; Schneider, Ondřej (referee)
Master Thesis - Simona Tothova Abstract This thesis empirically investigates impact of countries' bailouts on probability of SME segment distress. The impact is examined by multi-period logit model where dependent variable is distress rate and explanatory variables includes self-constructed bailout variable, several binary predictors and firm-specific and macroeconomic control variables. The hypotheses are tested on dataset for period from 2005 to 2013 including observations from seven European countries which received financial assistance program (bailout) from Troika. Every bailout from Troika comes with the requirement for austerity measures and our results suggest that impact of bailouts on SMEs probability of distress are depended on the success of application in individual countries and the impacts are more positive in non euro-zone countries. Keywords Bailout, Financial crisis, Credit risk, SME segment, Distress rate Author's e-mail tothova.simona@gmail.com Supervisor's e-mail rado.parrak@gmail.com
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Low Interest Rates and Asset Price Fluctuations: Empirical Evidence
Ali, Bano ; Horváth, Roman (advisor) ; Vácha, Lukáš (referee)
The thesis focuses on estimating the effect of expansionary monetary policy concerning asset prices, specifically house and stock prices as they are of pri- mary importance in financial markets. A structural vector autoregressive model is used including data for the Euro Area, the United Kingdom, and the United States from 2007 to 2017. Moreover, instead of short-term nominal interest rate, the shadow policy rate is used to measure the stance of both conventional and unconventional monetary policy. It is useful when policy rates of central banks are at or near zero as it neglects the zero-lower bound. Using both impulse response functions and forecast error variance decomposition, results suggest that higher interest rates are indeed associated with lower asset prices. That is confirmed by including two different estimates of shadow rates into the model and observing the effect for two specific types of assets. More precisely, house prices react almost immediately showing the most substantial decrease for the United Kingdom, while stock prices slightly increase at first and de- crease afterward with similar size of the effect for all areas under consideration. Finally, the discussion of how the monetary authority should react to asset price fluctuations is provided, summarizing the vast amount of literature...
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The role of credit default swaps during the subprime mortgage crisis in 2007-2009
Lazukićová, Andrea ; Teplý, Petr (advisor) ; Vozková, Karolína (referee)
This thesis focuses on the role of credit default swaps during the subprime mortgage crisis 2007-2009 with special focus on mortgage-backed securities. In the empirical part of the thesis, three models are constructed. All of them have the same dependent variable, a mortgage delinquency rate in the 2005-2010 period, and independent variables representing various types of credit default swaps issued. Streamlined in each model, credit default swaps (CDS) were divided based on certain criteria (underlying sectors, maturity and ranking) and subsequently compared and analysed. By using the probit model, the main research question "How the probability of mortgage delinquency depends on the volume of credit default swaps issued?" was inspected. The contribution of this thesis is three-fold. First, we show that a delinquency rate of mortgages was correlated with the maturity of CDS issued (the delinquency rate was higher for short-term loans). Second, we state that the volume of subprime loans increased along with the volume of issued CDS, what contradicts to the insurance nature of a CDS. Finally, a mortgage delinquency rate was lower in the 2006-2008 period than in 2009-2011, what implies the domino effect of failing mortgages had an immense impact even after the global crisis.
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Deposit Insurance in the European Union
Holá, Veronika ; Jakubík, Petr (advisor) ; Teplý, Petr (referee)
This thesis examines the question whether uncoordinated steps of some EU states changing their deposit insurance schemes in the middle of 2008 could have led to shifts of deposits among EU countries. The paper deals mainly with changes of the rules which were introduced at the end of year 2008, and concerns with the amended Directive on Deposit Guarantee Schemes. Empirical analysis concentrates on the impact of state guarantees on the deposit grow rate in individual states. In the final part, we discuss the consequences of recent development and possible future progress.
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