Description: The Price of Inconvertible Deposits : The Stock Market Boom during the Argentine Crisis

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The Price of Inconvertible Deposits : The Stock Market Boom during the Argentine Crisis

The Argentine crisis witnessed, among other things, a deposit run, the suspension of deposit convertibility, and a "boom" in the stock market. The authors argue that this boom reflects the cost that depositors were willing to incur to get...

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Bibliographic Details
Main Authors:	Levy Yeyati, Eduardo, Schmukler, Sergio L., Van Horen, Neeltje
Language:	English en_US
Published:	World Bank, Washington, DC 2014
Subjects:	FINANCIAL CRISES ECONOMIC CRISIS CONVERTIBILITY DEPOSIT BANKING STOCK MARKETS BANKING SYSTEMS RISK AVERSION LIQUIDITY (ECONOMICS) FISCAL CONSTRAINTS BANKING REGULATIONS CAPITAL CONTROLS CAPITAL FLIGHT CAPITAL FLIGHT ARBITRAGE BANK DEPOSITS BANK RUN BANKING CRISIS BANKING SECTOR BANKING SYSTEM CAPITAL INFLOWS CAPITAL MARKETS CAPITAL OUTFLOWS CAPITALIZATION CENTRAL BANK COST FUNCTIONS CURRENCY BOARD DEVALUATION DISCOUNT RATE DOLLAR DEPOSITS EMERGING MARKETS EQUITY MARKETS EXCHANGE RATE EXPENDITURES FINANCIAL CRISIS FINANCIAL MARKETS FINANCIAL SERVICES FINANCIAL SYSTEM FISCAL FEDERALISM FOREIGN DIRECT INVESTMENT FOREIGN EXCHANGE FREE TRADE INFLATION INTERNATIONAL FINANCIAL MARKETS LABOR MARKET LIQUIDITY MACROECONOMICS MARKET ACCESS MARKET CAPITALIZATION MARKET SEGMENTATION MIGRATION PORTFOLIO PRICE CAPS PRICE INDEX PRIVATE SECTOR SAVINGS SAVINGS DEPOSITS STOCK EXCHANGE STOCK EXCHANGE INDEX STOCK EXCHANGES STOCK MARKET STOCK PRICES STOCKS TRADE DIVERSION TRADE REFORMS USE VALUE WTO ARBITRAGE
Online Access:	http://documents.worldbank.org/curated/en/2003/10/2579640/price-inconvertible-deposits-stock-market-boom-during-argentine-crisis http://hdl.handle.net/10986/18037

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Summary:	The Argentine crisis witnessed, among other things, a deposit run, the suspension of deposit convertibility, and a "boom" in the stock market. The authors argue that this boom reflects the cost that depositors were willing to incur to get their money out of the banking system, in light of the impending risks. This boom was generalized to all stocks, and more pronounced in liquid stocks. Furthermore, the boom was a symptom that deposits were effectively restricted, and that investors were not able to circumvent capital controls.