Collateral
in sentence
330 examples of Collateral in a sentence
BUENOS AIRES – Today’s global currency war resembles real war in two important respects: a face-off over the structural imbalances between two large opponents – China and the United States – has forced uncomfortable smaller allies to take one side or the other, and third parties that may not be directly engaged are suffering
collateral
damage from both sides of the dispute.
Some economies may sustain
collateral
damage from both sides of the war, because, in addition to the pressure coming from excess dollar liquidity, they may be confronted with tougher competition (domestically and in third markets) from China, so long as the renminbi remains quasi-pegged to the dollar.
Willem Buiter of the University of Amsterdam and Anne Sibert of the University of London believe that it is the ECB’s willingness to, in effect, accept all euro-zone debt as
collateral
that has undermined the market’s willingness to be an enforcer of fiscal prudence.
As long as the marginal piece of German debt is used as
collateral
for a short-term loan or as the centerpiece of a repurchase agreement to gain liquidity, its value is much more likely to be determined by the terms on which the ECB accepts it as
collateral
than by its fundamentals.
The procedures to trigger this intervention, however, are complex and the funding is sufficiently opaque that the bill will not eliminate
collateral
damage from a large bank failure even for US institutions, let alone for international ones, whose unwinding would require coordination by several states, with varying degree of solvency.
Periods of rapid growth in lending are often associated with construction booms, partly because real-estate assets are relatively easy to post as
collateral
for loans.
Millions of others may experience
collateral
damage, as financial contagion risks spreading to other European countries and to the global economy as a whole.
If Brexit weakens London’s role as a financial center, the
collateral
damage for Africa would be measured in diminished investor confidence, gaps in banking services, and interrupted networks and processes.
That is, an increase in the willingness to lend tends to increase the value of the collateral, and also improves the borrowers’ performance, thereby encouraging a relaxation of credit criteria.
Imagine a development bank levering up
collateral
that comprises post-privatization equity retained by the state and other assets (for example, real estate) that could easily be made more valuable (and collateralized) by reforming their property rights.
But lack of transparency played a central role in this past summer’s credit crunch; toxic mortgages were sliced and diced, spread around the world, packaged with better products, and hidden away as collateral, so no one could be sure who was holding what.
Why not use the much-heralded stability fund as
collateral
for a European Brady bond plan that puts an end to the sovereign debt saga?
Because bank deposit insurance covered only up to $100,000, those with millions to store often preferred the overnight market, using ultra-safe long-term US Treasury obligations as
collateral.
But overnight lenders could command even higher interest rates if they took as
collateral
a less-safe mortgage pool, so many did just that.
They balked at the idea of parking their cash overnight, with mortgage pools as
collateral.
Worse still, they are being allowed to borrow cheaply from the United States Federal Reserve, on the basis of poor collateral, and simultaneously to take risky positions.
As sterilization induces issuance of domestic assets, global investors’ desire for diversification would be met without causing excessive currency appreciation, with all its
collateral
damage, in emerging markets.
A truly independent ECB, adhering to its own rules, should have refused to accept as
collateral
all debt liabilities guaranteed by the Greek state – government bonds, treasury bills, and the more than €50 billion ($56 billion) of IOUs that Greece’s banks have issued to remain afloat.
To keep Greece’s banks open, and accept their government-guaranteed collateral, the ECB is obliged to grant Greek debt an exemption from its no-insolvency rule.
The reason, of course, was the common knowledge that Germany, vehemently opposed to our government, was about to switch off the green light required by the ECB to maintain the exemptions allowing it to accept Greek
collateral.
Local governments use land as
collateral
to take out loans to fund infrastructure investment, then finance repayment by relying on revenues from subsequent land sales.
Then, unnamed investors (allegedly the largest Russian state banks) benefited from the CBR’s decision on December 12 to allow these bonds to be used as
collateral
for three-year CBR ruble loans at the policy rate.
Sustainability in the Trump EraCOPENHAGEN – The forces fighting global warming and battling to strengthen environmental protection must brace for heavy
collateral
damage as a result of Donald Trump’s victory in the United States’ presidential election.
But this implies a complex and cumbersome approval process and the provision of high-quality
collateral.
Aided by the European Central Bank – which loosened its
collateral
policy for refinancing credits and increased its tolerance for emergency liquidity assistance and credits under the Agreement on Net Financial Assets – they drew hundreds of billions of euros out of the monetary system through so-called Target overdrafts.
Given that banks prefer lending to larger enterprises and borrowers with collateral, small and medium-size enterprises struggle to gain access to credit and capital.
Given property’s role as the main form of
collateral
for bank loans, financial risk has risen sharply.
Critics have questioned the plan’s legality, the risk of
collateral
damage, and, most important, the effectiveness of armed intervention in stemming human-trafficking operations.
As a result, people assumed that the problem of monetary stability had been solved, and that they could pile up assets and then use them as
collateral
to borrow ever-larger sums.
(In fact, it may not even be desirable, given the possibility of
collateral
damage and unintended consequences.)
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