Financial governance: the Brazilian experience on prudential regulation and its impacts on the effects of the 2008 financial crisis

The Brazilian economy was severely hit by the 2008 crisis. In the beginning of the crisis, the vast majorities of the economic agents and authorities thought that Brazil could face some sort of decoupling since some macroeconomic fundamentals were very good. What we saw, however, was that the Brazilian economy was not decoupled, and expectations faced a huge deterioration soon after the bankruptcy of Lehman Brothers in September 15th. Two aspects regarding the impact of crisis in Brazil, however, deserve a great deal of attention: (a) although deep, the impact did not last for a long time. Actually, the GDP growth experienced a good recovery in the second quarter of 2009, showing that the health of the Brazilian economy was good; (b) the Brazilian banking system performed very well during the crisis, although we cannot say the system was not in danger in the worst time of the crisis. In spite of the confidence crisis faced by the banking system 1, it showed a great deal of resilience. In this aspect, we argue that the restructure faced by the banking system in the aftermath of the Real Plan, as well as the development of a solid supervision regulation helped a lot the system to avoid the systemic crisis that was an open possibility to the Brazilian banking system in the end of 2008. These notes, thus, discusse why the Brazilian banking system performed pretty well in the 2008 financial crisis and how the Brazilian banking (and prudential) regulation can be taken as responsible for this good performance. More specifically, the paper back to the middle of the 1990s, when the Real Plan was implemented, in order to understand the role played by the restructuring of the Brazilian financial system in helping to pave the way to the great resilience experienced by the Brazilian banking system during the 2008 crisis. More specifically, the prudential regulation that was implemented in Brazil in the aftermath of the Real Plan seems to play a decisive role in the resilience of the system nowadays.

How the full opening of the capital account to highly liquid financial markets led Latin America to two and a half cycles of ‘mania, panic and crash’

Latin America has recently experienced three cycles of capital inflows, the first two ending in major financial crises. The first took place between 1973 and the 1982 ‘debt-crisis’. The second took place between the 1989 ‘Brady bonds’ agreement (and the beginning of the economic reforms and financial liberalisation that followed) and the Argentinian 2001/2002 crisis, and ended up with four major crises (as well as the 1997 one in East Asia) — Mexico (1994), Brazil (1999), and two in Argentina (1995 and 2001/2). Finally, the third inflow-cycle began in 2003 as soon as international financial markets felt reassured by the surprisingly neo-liberal orientation of President Lula’s government; this cycle intensified in 2004 with the beginning of a (purely speculative) commodity price-boom, and actually strengthened after a brief interlude following the 2008 global financial crash — and at the time of writing (mid-2011) this cycle is still unfolding, although already showing considerable signs of distress. The main aim of this paper is to analyse the financial crises resulting from this second cycle (both in LA and in East Asia) from the perspective of Keynesian/ Minskyian/ Kindlebergian financial economics. I will attempt to show that no matter how diversely these newly financially liberalised Developing Countries tried to deal with the absorption problem created by the subsequent surges of inflow (and they did follow different routes), they invariably ended up in a major crisis. As a result (and despite the insistence of mainstream analysis), these financial crises took place mostly due to factors that were intrinsic (or inherent) to the workings of over-liquid and under-regulated financial markets — and as such, they were both fully deserved and fairly predictable. Furthermore, these crises point not just to major market failures, but to a systemic market failure: evidence suggests that these crises were the spontaneous outcome of actions by utility-maximising agents, freely operating in friendly (‘light-touch’) regulated, over-liquid financial markets. That is, these crises are clear examples that financial markets can be driven by buyers who take little notice of underlying values — i.e., by investors who have incentives to interpret information in a biased fashion in a systematic way. Thus, ‘fat tails’ also occurred because under these circumstances there is a high likelihood of self-made disastrous events. In other words, markets are not always right — indeed, in the case of financial markets they can be seriously wrong as a whole. Also, as the recent collapse of ‘MF Global’ indicates, the capacity of ‘utility-maximising’ agents operating in (excessively) ‘friendly-regulated’ and over-liquid financial market to learn from previous mistakes seems rather limited.

How the full opening of the capital account to highly liquid financial markets led Latin America to two and a half cycles of ‘mania, panic and crash’

Latin America has recently experienced three cycles of capital inflows, the first two ending in major financial crises. The first took place between 1973 and the 1982 ‘debt-crisis’. The second took place between the 1989 ‘Brady bonds’ agreement (and the beginning of the economic reforms and financial liberalisation that followed) and the Argentinian 2001/2002 crisis, and ended up with four major crises (as well as the 1997 one in East Asia) — Mexico (1994), Brazil (1999), and two in Argentina (1995 and 2001/2). Finally, the third inflow-cycle began in 2003 as soon as international financial markets felt reassured by the surprisingly neo-liberal orientation of President Lula’s government; this cycle intensified in 2004 with the beginning of a (purely speculative) commodity price-boom, and actually strengthened after a brief interlude following the 2008 global financial crash — and at the time of writing (mid-2011) this cycle is still unfolding, although already showing considerable signs of distress. The main aim of this paper is to analyse the financial crises resulting from this second cycle (both in LA and in East Asia) from the perspective of Keynesian/ Minskyian/ Kindlebergian financial economics. I will attempt to show that no matter how diversely these newly financially liberalised Developing Countries tried to deal with the absorption problem created by the subsequent surges of inflow (and they did follow different routes), they invariably ended up in a major crisis. As a result (and despite the insistence of mainstream analysis), these financial crises took place mostly due to factors that were intrinsic (or inherent) to the workings of over-liquid and under-regulated financial markets — and as such, they were both fully deserved and fairly predictable. Furthermore, these crises point not just to major market failures, but to a systemic market failure: evidence suggests that these crises were the spontaneous outcome of actions by utility-maximising agents, freely operating in friendly (light-touched) regulated, over-liquid financial markets. That is, these crises are clear examples that financial markets can be driven by buyers who take little notice of underlying values — investors have incentives to interpret information in a biased fashion in a systematic way. ‘Fat tails’ also occurred because under these circumstances there is a high likelihood of self-made disastrous events. In other words, markets are not always right — indeed, in the case of financial markets they can be seriously wrong as a whole. Also, as the recent collapse of ‘MF Global’ indicates, the capacity of ‘utility-maximising’ agents operating in unregulated and over-liquid financial market to learn from previous mistakes seems rather limited.

Contagion in financial networks: a network theory and agent-based approaches to modeling the spread of risk in financial systems

Esta dissertação estuda a propagação de crises sobre o sistema financeiro. Mais especi- ficamente, busca-se desenvolver modelos que permitam simular como um determinado choque econômico atinge determinados agentes do sistema financeiro e apartir dele se propagam, transformando-se em um problema sistêmico. A dissertação é dividida em dois capítulos,além da introdução. O primeiro capítulo desenvolve um modelo de propa- gação de crises em fundos de investimento baseado em ciência das redes.Combinando dois modelos de propagação em redes financeiras, um simulando a propagação de perdas em redes bipartites de ativos e agentes financeiros e o outro simulando a propagação de perdas em uma rede de investimentos diretos em quotas de outros agentes, desenvolve-se um algoritmo para simular a propagação de perdas através de ambos os mecanismos e utiliza-se este algoritmo para simular uma crise no mercado brasileiro de fundos de investimento. No capítulo 2,desenvolve-se um modelo de simulação baseado em agentes, com agentes financeiros, para simular propagação de um choque que afeta o mercado de operações compromissadas.Criamos também um mercado artificial composto por bancos, hedge funds e fundos de curto prazo e simulamos a propagação de um choque de liquidez sobre um ativo de risco securitizando utilizado para colateralizar operações compromissadas dos bancos.

An essay on economic growth: classical determinants, convergence and financial development

This dissertation surveys the literature on economic growth. I review a substantial number of articles published by some of the most renowned researchers engaged in the study of economic growth. The literature is so vast that before undertaking new studies it is very important to know what has been done in the field. The dissertation has six chapters. In Chapter 1, I introduce the reader to the topic of economic growth. In Chapter 2, I present the Solow model and other contributions to the exogenous growth theory proposed in the literature. I also briefly discuss the endogenous approach to growth. In Chapter 3, I summarize the variety of econometric problems that affect the cross-country regressions. The factors that contribute to economic growth are highlighted and the validity of the empirical results is discussed. In Chapter 4, the existence of convergence, whether conditional or not, is analyzed. The literature using both cross-sectional and panel data is reviewed. An analysis on the topic of convergence using a quantile-regression framework is also provided. In Chapter 5, the controversial relationship between financial development and economic growth is analyzed. Particularly, I discuss the arguments in favour and against the Schumpeterian view that considers financial development as an important determinant of innovation and economic growth. Chapter 6 concludes the dissertation. Summing up, the literature appears to be not fully conclusive about the main determinants of economic growth, the existence of convergence and the impact of finance on growth.

Prevalence and antifungal susceptibility of Candida parapsilosis complex isolates collected from oral cavities of HIV-infected individuals

At present, few data are available on the prevalence and antifungal susceptibility of Candida parapsilosis complex isolates from HIV-infected individuals. The C. parapsilosis complex comprises three species, C. parapsilosis sensu stricto, C. metapsilosis and C. orthopsilosis. Fifteen of 318 Candida isolates were identified as members of the C. parapsilosis complex by PCR and restriction fragment length polymorphism (RFLP). The prevalence of C. parapsilosis complex isolates was 4.7 %, 2.2 % being identified as C. parapsilosis sensu stricto and 2.5% as C. metapsilosis, while no C. orthopsilosis was isolated. This is believed to be the first study that has identified isolates of C. metapsilosis obtained from the oral cavity of HIV-infected individuals. Antifungal susceptibility tests indicated that all the isolates were susceptible to amphotericin B (AMB), fluconazole (FLC), ketoconazole (KTC), itraconazole (ITC), voriconazole (VRC) and caspofungin (CASPO). Although isolates of C. parapsilosis sensu stricto and C. metapsilosis were susceptible to FLC, isolates of C. metapsilosis showed a tendency for higher MICs (>= 1.0 mu g ml(-1)). Based upon the frequency of candidiasis and the fact that certain isolates of the C. parapsilosis complex respond differently to FLC therapy, our data may be of therapeutic relevance with respect to susceptibility and potential resistance to specific antifungal agents. Our data suggest that C. metapsilosis can be a human commensal; its importance as a pathogen has yet to be confirmed.

Structures of human purine nucleoside phosphorylase complexed with inosine and ddI

Human purine nucleoside phosphorylase (PNP) is a ubiquitous enzyme which plays a key role in the purine salvage pathway, and PNP deficiency in humans leads to an impairment of T-cell function, usually with no apparent effect on B-cell function. PNP is highly specific for 6-oxopurine nucleosides and exhibits negligible activity for 6-aminopurine nucleosides. The catalytic efficiency for inosine is 350,000-fold greater than for adenosine. Adenine nucleosides and nucleotides are deaminated by adenosine deaminase and AMP deaminase to their corresponding inosine derivatives which, in turn, may be further degraded. Here we report the crystal structures of human PNP in complex with inosine and 2',3'-dideoxymosine, refined to 2.8 Angstrom resolution using synchrotron radiation. The present structures provide explanation for ligand binding, refine the purine-binding site, and can be used for future inhibitor design. (C) 2003 Elsevier B.V. All rights reserved.

Synthesis of (Ca,Nd)TiO3 powders by complex polymerization, Rietveld refinement and optical properties

Coordenação de Aperfeiçoamento de Pessoal de Nível Superior (CAPES)

Synthesis and X-ray structure of the dinuclear platinum(II) complex with saccharin {K[Pt(sac)(3)(H2O)] center dot H2O}(2): Studies on its antiproliferative activity in aqueous solution

Synthesis and X-ray structure of a dinuclear platinum(II) complex with the ligand saccharin(sac) are described. The structure shows two approximately square-planar platinum centers. Each platinum atom is coordinated to one water molecule and three N-bonded saccharinate ligands. The two centers are linked through two potassium atoms. Each potassium atom interacts with six oxygen atoms from hydration and coordinated water molecules and from carbonyl and sulfonate groups of the ligands. It is suggested that, in aqueous solution, the dimeric structure of the complex is dissociated and the monomeric species K[Pt(sac)(3)(H2O)] is formed. The complex was dissolved in water and submitted to in vitro cytotoxic analyses using HeLa cells (human cervix cancer). It was shown that the monomeric complex elicited a potent cytotoxic activity when compared to the vehicle-treated cells. The IC50 value for the monomeric complex is 6.8 mu M, a little bit higher than that obtained for cisplatin. (c) 2007 Elsevier B.V. All rights reserved.

Product development process: Using real options for assessments and to support the decision-making at decision gates

Enterprises need continuous product development activities to remain competitive in the marketplace. Their product development process (PDP) must manage stakeholders' needs - technical, financial, legal, and environmental aspects, customer requirements, Corporate strategy, etc. -, being a multidisciplinary and strategic issue. An approach to use real option to support the decision-making process at PDP phases in taken. The real option valuation method is often presented as an alternative to the conventional net present value (NPV) approach. It is based on the same principals of financial options: the right to buy or sell financial values (mostly stocks) at a predetermined price, with no obligation to do so. In PDP, a multi-period approach that takes into account the flexibility of, for instance, being able to postpone prototyping and design decisions, waiting for more information about technologies, customer acceptance, funding, etc. In the present article, the state of the art of real options theory is prospected and a model to use the real options in PDP is proposed, so that financial aspects can be properly considered at each project phase of the product development. Conclusion is that such model can provide more robustness to the decisions processes within PDP.

Synthesis and characterization of solid molybdenum(VI) complexes with glycolic, mandelic and tartaric acids. Photochemistry behaviour of the glycolate molybdenum complex

The complexes (NH4)(2)[ MoO2( C2H2O3)(2)]center dot H2O, (NH4)(2)[MoO2(C8H6O3)(2)] and (NH4)(2) [MoO3(C4H4O6)]center dot H2O were prepared by reaction of MoO3 with glycolic, mandelic and tartaric acids, respectively. The complexes were characterized by elemental and thermal analysis, IR spectroscopy and X- ray diffraction. Crystals of the glycolate and tartarate complexes are orthorhombic and the mandelate complex is monoclinic. Elemental and thermal analysis data showed that the glycolate and tartarate complexes are monohydrated. Hydration water is not present in the structure of the mandelate complex. IR spectra showed COO- is involved in coordination as well as the oxygen atom of the deprotonated hydroxyl group of the alpha-carbon. The glycolate molybdenum complexes with general formula M-2[MoO2(C2H2O3)(2)]center dot nH(2)O, where M is an alkali metal and n=1 or 1/2, were also prepared and characterized. Aqueous solutions of the glycolate complex become blue and mandelate and tartarate complexes change to yellow or brown when exposed to UV- radiation.

Synthesis, characterization, and biological activity of a new palladium(II) complex with deoxyalliin

Synthesis, characterization, and biological activity of a new water-soluble Pd(II)-deoxyalliin (S-allyl-L-cysteine) complex are described in this article. Elemental and thermal analysis for the complex are consistent with the formula [Pd(C6H10NO2S)2]. 13C NMR, 1H NMR, and IR spectroscopy show coordination of the ligand to Pd(II) through S and N atoms in a square planar geometry. Final residue of the thermal treatment was identified as a mixture of PdO and metallic Pd. Antiproliferative assays using aqueous solutions of the complex against HeLa and TM5 tumor cells showed a pronounced activity of the complex even at low concentrations. After incubation for 24 h, the complex induced cytotoxic effect over HeLa cells when used at concentrations higher than 0.40 mmol/L. At lower concentrations, the complex was nontoxic, indicating its action is probably due to cell cycle arrest, rather than cell death. In agreement with these results, the flow cytometric analysis indicated that after incubation for 24 h at low concentrations of the complex cells are arrested in G0/G1. © 2005 NRC Canada.

Economic Survey of Latin America and the Caribbean 2007-2008: Macroeconomic policy and volatility

Includes bibliography

Economic Survey of Latin America and the Caribbean 2010-2011: Internacional integration and macroeconomic policy challenges amid global economic turmoil

Includes bibliography

Latin America and the Caribbean in the World Economy 2004: 2005 trends

Includes bibliography