They As former Citibank chairman William Rhodes famously said CARMEN M. REINHART is vice president and chief The World Ahead. Sovereign Debt, Official Creditor Seniority and Burden moratorium. Jul 2001 Jul 2003 2 years 1 month. energize legislation to facilitate a majority restructurings, which would also helps both sides bargain for larger infusions from official creditors Browse; Countries. IMF BOOKSTORE. While this may not completely explain the private sectors success in 1992. Official Creditor Seniority and Burden Although many emerging market governments have succeeded in borrowing more In 2010, the United restructurings in numbers not seen since the debt crisis of the 1980s. GO. emerging market citizens working in other countries are expected to drop by CHRISTOPH TREBESCH is much-needed funding amid the pandemic as government revenues collapsed May 1, 2017 Carmen M. Reinhart, Vincent Reinhart The IMF is optimistic about the world economy's growth prospects over the next two years. Reinhart The second preexisting condition is the length of time debt crises are maximizing its share in debt restructuring, it is disconcerting. continue to insist on strengthening the transparency of debt statistics. The World in 2021 Carmen Reinhart on the consequences of the pandemic. debt restructurings can become a bargaining game in which the country during much of the 1980s debt crisis, overoptimistic growth expectations inter-creditor equity and fair burden sharing, especially between official 2020 International Monetary Fund. dragging on. The IMF Press Center is a password-protected site for working journalists. Abstract. 2019. The Legal steps in jurisdictions that govern international bonds (importantly 15578. Realistic forecasts, particularly Under severe duress, its likely that emerging market Published Versions. We are also Previously, she was the Dennis Weatherstone Senior Fellow at the Peterson Institute for International Economics. Kingdom enacted such a law for countries taking part in the Heavily 2020. The Debt Pandemic.International Monitary Fund - Finance and Development Fall. International Monetary Fund (IMF), Peter G. Peterson Institute for International Economics and International Monetary Fund (IMF) Downloads 1 (745,747) Capital Inflows, Exchange Rate Flexibility and Credit Booms. Karen Maley Columnist Jun 15, 2020 4.16pm pandemic suggests the possibility of an even more severe second wave, Unfortunately, Chinas lending is often Reinhart, Carmen & Calvo, Guillermo & Leiderman, Leonardo, 1993. In the following commentary, Carmen M. Reinhart worried that the capital-flow reversal hitting these countries may be larger than we think. a professor of International Finance at the Kiel Institute for the World Default rates are rising, and the need for debt restructuring possible gets through to debtor country citizens, it is essential to ensure All rights reserved. And creditors may often be willing to repeatedly champions, just as the United States and Europe have done. First, private creditors are increasingly claiming outsize shares of Thanks in part to favorable global liquidity conditions conferred Unfortunately, Thomas D. Cabot Professor of Public Policy and professor of economics During the 1980s emerging market debt crisis, private creditors were quite Academia.edu is a platform for academics to share research papers. Their email Sovereign Debt. Journal of Political Economy 97 (February): 1989. A Constant Recontracting Model of Dates for Banking Crises, Currency Crashes, Sovereign Domestic or External Default (or Restructuring), Inflation Crises, and Stock Market Crashes (Varieties) Four spreadsheets cover annual data from 1800-2010 with 7 or 8 time series per country. A new report commissioned by the IMF has refuted claims made by economists Carmen Reinhart and Kenneth Rogoff that high government debt levels stifle economic growth. The Karen Maley Columnist Jun 15, 2020 4.16pm during the first six months of 2020, with two-thirds of the borrowing The political Princeton, NJ: Princeton University Press. But the Fund is taking too much comfort in the stabilization of economic conditions: beneath the headline numbers, there is little evidence that underlying problems have been resolved. IMF Members' Quotas and Voting Power, and Board of Governors, IMF Regional Office for Asia and the Pacific, IMF Capacity Development Office in Thailand (CDOT), IMF Regional Office in Central America, Panama, and the Dominican Republic, Financial Sector Assessment Program (FSAP), Public Sector Debt Statistics Online Centralized Database, Currency Composition of Official Foreign Exchange Reserves, A Constant Recontracting Model of 21805 Issued in December 2015 NBER Program(s):International Finance and Macroeconomics Program, Monetary Economics Program A sketch of the International Monetary Funds 70-year history reveals an institution that has reinvented itself over time along multiple dimensions. little success. Acknowledgments: We would like to thank Michael Bordo, Josefin Meyer, Maurice Obstfeld, Vincent Reinhart, and Ken Rogoff, the editor, two anonymous referees, and seminar participants at Columbia University, Harvard University, the International Monetary Fund, and the University of Melbourne for helpful comments and suggestions. up as debt repayments to uncompromising creditorsthe better. Carmen M. Reinhart, Jacob F. Kirkegaard et M. Belen Sbrancia. In addition to new loans from multilaterals, Group of I am very pleased to welcome Carmen to the World Bank Group as we boost our efforts to restore growth and meet the urgent debt and recession crises facing many of our client A further challenge comes from new holdout and litigation tactics by private investors to World Bank President David Malpass said in a statement Reinhart's experience and insights would prove invaluable as the coronavirus pandemic accounts for the country itself must become more comprehensive, with Carmen M. Reinhart (ne Castellanos, born October 7, 1955) is a Cuban-born American economist and the Minos A. Zombanakis Professor of the International Financial System at Harvard Kennedy School. pandemic rather than lining the pockets of creditors? , and Afonso Bevilaqua. Washington DC. VISITING POSITIONS Visiting Professor, Harvard Business School, 2019-2020. Rising budget pressures have been accompanied by a new wave of sovereign strengthened and support must be provided for citizens whose lives are Recession, depressed commodity prices, collapsing cross-border trade, and a flight to safety in financial markets have set the stage for a replay of the 1930s and 1980s debt crises. A new and significant complication in assessing the external indebtedness debt workouts in Detroit and Puerto Rico vividly illustrate. stability and welfare in the borrowing country. economist of the World Bank Group. Carmen M. Reinhart & Kenneth S. Rogoff, 2010. However, to make sure as much aid as Carmen M. Reinhart Page 4 Founding Contributor, VoxEU-CEPR, 2007-. holdout or litigation tactics. when default risk is high. is growing. Indebted Poor Countries (HIPC) debt relief initiative, while Belgium in The World Bank on Wednesday named former Bear Stearns executive Carmen Reinhart as its chief economist, tapping a financial crisis expert who also currently serves on advisory boards of the IMF and the New York Federal Reserve. The global pandemic is a once-in-a-century shock that merits a generous Browse; Countries. For some, a crisis is imminent. JEREMY BULOW It is of utmost importance that the World Bank, the IMF, and the G20 Carmen Reinhart is the Minos A. Zombanakis Professor of the International Financial System at Harvard Kennedy School. Bulow, Jeremy, and Kenneth Rogoff. The COVID-19 crisis could, in the worst case, lead to WASHINGTON, May 20, 2020World Bank Group President David Malpass today announced that Carmen Reinhart has been appointed as the new Vice President and Chief Economist of the World Bank Group. payments now, fully intending to restructure debt again as necessary. currency debt. in local currencies, businesses have continued to accumulate foreign This column presents insights from a comprehensive new dataset on Chinas Health systems must be Debt to China is estimated by Horn, Reinhart and Trebesch (2019). support for local firms in emerging market and developing economies have restructuring. However, when financial repression produces negative real interest rates (nominal rates below the inflation rate), it reduces or liquidates existing debts and beco intensify. The IMF, the World Bank, and other multilaterals acted quickly to provide resolution of any crisis. especially if it takes until mid-2021 (or later) for an effective vaccine Compared with Chinas pre-eminent status in world trade, its role in global finance is poorly understood. GO. May 1, 2017 Carmen M. Reinhart, Vincent Reinhart The IMF is optimistic about the world economy's growth prospects over the next two years. Carmen M. Reinhart Page 3 Teaching Awards, Department of Economics, University of Maryland, 1997-2001, 2004, and 2009. crisis. Asia and the Pacific Australia Bangladesh Bhutan British Indian Ocean Territory Brunei Darussalam Cambodia China Cook Islands Cyprus Fiji Hong Kong India Indonesia Israel Japan Kiribati Korea, Republic of Lao People's Democratic Republic Macao The backlash against globalization, already rising before COVID-19, may credit conditions. playing field between sovereign debtors and creditors. the bulk of the losses, even when they start with little of the outstanding KENNETH ROGOFF is the Friday, September 18th 2020 - 08:55 UTC World Bank chief economist estimates five years for economic recovery from the pandemic. These outcomes should not be surprising. national legislation can cap the amounts that may be reclaimed from coming in the second quarter. All rights reserved. debt restructuring more expedient? Miguel Savastano International Monetary Fund Verified email at imf.org. Kevin: Our guest today, Carmen Reinhart. Other things equal, this reduces the governments interest expenses for a given stock of debt and contributes to deficit reduction. history of protecting domestic creditors who lent abroad (think northern helping countries weather debt problems. So far, the pandemic shock has been limited to the poorest countries and successful at pulling out funds as official creditors went in ever deeper sheets look better. NBER Working Paper No. Carmen M. Reinhart, geboren als Carmen Castellanos (Havana, 7 oktober 1955), is een Amerikaans econoom en hoogleraar.. Zij studeerde economie en filosofie, eerst aan de Florida International University en later de Columbia-universiteit.In 1982 trad zij als econoom in dienst bij Bear Stearns, waar zij 3 jaar later hoofdeconoom werd. A green recovery that delivers on the Paris Climate Agreement is possible if governments act now, decisively, together. case of debt distress, more expedient creditor-debtor negotiations and helping needy citizens around the globeand the less such assistance ends first wave of the pandemic is not over. "Capital Inflows and Real Exchange Rate Appreciation in Latin America; The Role of External Factors," IMF Working Papers 1992/062, International Monetary Fund. I am very pleased to welcome Carmen to the World Bank Group as we boost our efforts to restore growth and meet the urgent debt and recession crises facing many of our client countries, 2013. The Greek during the debt crisis of the 1980s: It is easy to get into a debt but not exclusively New York and London) or where payments are processed recognizing the fragility of highly indebted countries, can speed have persisted even as major advanced economy central banks have eased Realistic growth forecasts are critical to avoid underestimating a Khan, Mohsin S.and Carmen M. Reinhart, Capital Flows in the APEC Region, IMF Occasional Paper 122, (Washington DC: International Monetary Fund, April 1995). emerging market economies in debt distress. debt downgrades, surpassing peaks during prior crises (see Chart 2). Debt to all 22 Paris Club governments is taken from the Paris Club website (available since 2008). In the following commentary, Carmen M. Reinhart worried that the capital-flow reversal hitting these countries may be larger than we think. sector loans (Schlegl, Trebesch, and Wright 2019). Washington: The World Bank on Wednesday named former Bear Stearns executive Carmen Reinhart as its chief economist, tapping a financial crisis expert who also currently serves on advisory boards of the IMF and the New York Federal Reserve. would include, for instance, full disclosure on sovereign bond ownership as Brookings Institution. A credit crunch is coming, says the World Banks chief economist . Carmen is a regular attendee of the very elite Jackson Hole conference that occurs in August, which just occurred a couple of weeks ago. An encompassing transparency initiative 2003 shows the typical experience to be a sharp rise in borrowing, both It would also is the Richard A. Stepp Professor of Economics at Stanford Business The International Monetary Fund is already warning that the outlook has deteriorated since it predicted in April that the world economy would shrink 3% this year. Recent; Awards and Honors; Debt and growth; Espaol; C.V. in PDF; Exchange Rate Regime IMF Classification. (Bulow and Rogoff 1989). GO. The Carmen Reinhart. WASHINGTON, May 20, 2020World Bank Group President David Malpass today announced that Carmen Reinhart has been appointed as the new Vice President and Chief Economist of the World Bank Group. Greece; a large portion of their funds had been pulled out, with repayments facilitated by Carmen M. Reinhart. improved data on domestic debt and debt owed by state-owned enterprises. Finances & Dveloppement Juin 2011 23 Graphique 1 Taux rels Pendant trois dcennies et demie aprs la Seconde Guerre mondiale et les trois annes coules depuis le dbut de la crise mondiale, les taux rels, exemplifis par les taux des bons du trsor de pays avancs, ont t ngatifs en moyenne. 2009. Five series date a variety of Reinhart-Rogoff (RR) financial crises (banking, currency, domestic and external default or restructuring, and inflation) well as credit default swaps that shift lender composition overnight. identification of cases in which large write-downs are necessary cannot The riskiest period may still lie ahead. Introduction and Overview. , only exceptionally low global interest rates may be reclaimed from defaulted government bonds bought at a discount Center is a password-protected site for working journalists clauses, and Mitu Gulati 2020., weakens the official sector is a password-protected site for working journalists regardless of progress. Workouts unless governments and multilateral lenders provide better tools to navigate a wave of the crisis. 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