Why does a social housing provider bet on interest rate fluctuations? This paper presents a case study of the financialization of both housing and the state. Social housing in the Netherlands is provided by non-profit housing associations... more
Why does a social housing provider bet on interest rate fluctuations? This paper presents a case study of the financialization of both housing and the state. Social housing in the Netherlands is provided by non-profit housing associations that since 1989 have been placed at a distance from the state. Many associations started developing housing for profit, borrowing on global capital markets or buying derivatives. Whereas other semi-public institutions moved into the world of finance due to financial constraints, housing associations moved in to capitalize on the possibilities offered by their asset-rich portfolios. Vestia, the largest of them all, is an extreme—but not an exceptional—case of what can happen when public goals need to be realized by under-supervised and poorly managed private organizations. As a result of gambling with derivatives, Vestia had to be bailed out for over €2 billion. To make up for the losses, housing was sold off and rents were raised. Almost half of the housing associations used derivatives but most of them refrained from using them in a purely speculative way. The changes in the housing sector that led to its financialization cannot be separated from the wider financialization of the state.
Key words: housing, financialization, derivatives, social housing, housing associations, the Netherlands
Apresenta-se o contrato de swap de taxa de juro a partir de casos reais e das decisões judiciais proferidas sobre eles. O índice que a seguir se transcreve evidencia o conteúdo deste texto e os grandes temas suscitados pelos litígios em... more
Apresenta-se o contrato de swap de taxa de juro a partir de casos reais e das decisões judiciais proferidas sobre eles. O índice que a seguir se transcreve evidencia o conteúdo deste texto e os grandes temas suscitados pelos litígios em torno dos referidos contratos: I. Objetivo e método; II. A noção de swap de taxa de juro; III. Preterição de convenção de arbitragem; IV. Violação de pacto de jurisdição; V. Invalidade do contrato por contrariedade à ordem pública; VI. Hedging, gestão de risco e cobertura de risco; VII. Alteração anormal das circunstâncias e aleatoriedade do contrato; VIII. Violação de deveres de informação e consequente erro; IX. Uma conclusão. O tratamento jurídico dos vários problemas facilita a compreensão da estrutura contratual em causa e tem alargado interesse na solução de situações análogas. Descritores: swap de taxa de juro, convenção de arbitragem, pacto de jurisdição, jogo e aposta, hedging e cobertura de risco, alteração anormal das circunstâncias, contrato aleatório, deveres de informação. Publicação: Higina Orvalho Castelo, «Swap de taxa de juro – os casos nos tribunais». Revista JULGAR, n.º 33, set.-dez. 2017, pp. 339-361.
The “plain vanilla” swap is an agreement to exchange interest rate payments on nominally identical principal. In the plain vanilla swap a floating interest rate is swapped for a fixed rate. These swaps are made between corporations with... more
The “plain vanilla” swap is an agreement to exchange interest rate payments on nominally identical principal. In the plain vanilla swap a floating interest rate is swapped for a fixed rate. These swaps are made between corporations with differing interest rate risk over the period of time under consideration. Swaps can be used to transform a liability into a fix rate loan or visa-versa. Financial intermediaries are involved to make the exchange more efficient, but bank fees involved.
ABSTRACT. Lo scritto analizza la recente decisione delle Sezioni Unite in tema di derivati degli enti locali alla luce del paradigma di qualificazione del contratto di swap: quello della scommessa razionale. Lo scopo del paper è di... more
ABSTRACT. Lo scritto analizza la recente decisione delle Sezioni Unite in tema di derivati degli enti locali alla luce del paradigma di qualificazione del contratto di swap: quello della scommessa razionale. Lo scopo del paper è di sviluppare alcuni argomenti critici di questo modello per riportare al centro dell’operazione l’elemento della gestione del rischio finanziario.
This paper analyses the Supreme Court of Cassation decision on swaps and local authorities, moving from the adopted criterion of contract’s qualification: the “rational bet”. The aim is to develop some critical arguments to this model in favour of an alternative criterion that qualifies the swap as contract for financial risk management
sommario: 1. La vicenda.-2. Contratto di swap ed eccezione di gioco.-3. Rischio di credito, etica degli affari e autonomia privata.-4. La categoria degli 5. Interest rate swap: struttura delle prestazioni. e 6. Misurabilità dell'alea e... more
sommario: 1. La vicenda.-2. Contratto di swap ed eccezione di gioco.-3. Rischio di credito, etica degli affari e autonomia privata.-4. La categoria degli 5. Interest rate swap: struttura delle prestazioni. e 6. Misurabilità dell'alea e varia
Active fixed income portfolio managers must choose degrees of interest rate, credit, and inflation exposures consistent with both their expectations for these parameters as well as their risk tolerance. The existing menu of cash... more
Active fixed income portfolio managers must choose degrees of interest rate, credit, and inflation exposures consistent with both their expectations for these parameters as well as their risk tolerance. The existing menu of cash instruments is restrictive. Many commonly desired combinations of interest rate, credit and inflation risk are simply unavailable. Swaps efficiently address this problem. Interest rate swaps exchange fixed for floating interest payments between the counterparties. Credit default swaps exchange premium payments for credit protection. Inflation swaps exchange actual inflation for expected inflation. Combining these derivatives with traditional cash instruments completes the menu of investment alternatives for the modern portfolio manager. Keywords: investment horizon; Treasury bill; Treasury bond; commercial paper; corporate bond; short-term interest rate exposure; long-term interest rate exposure; floating versus fixed-rate exposure; fixed-coupon; floating-rate note; credit risk; roll over; corporate profits; interest rate swap; credit spread; London Interbank Offered Rate (LIBOR); synthetic; decoupling; credit default swap (CDS); credit protection; reference asset; unfunded credit exposure; default; real interest rate; inflation premium; Treasury inflation-protected security (TIPS); nominal bond; inflation swap; corporate inflation protected security
