Notes on "Getting Back on Track: Macroeconomic Policy Lessons from the Financial Crisis" (John B. Taylor)

Getting Back on Track: Macroeconomic Policy Lessons from the Financial Crisis
John B. Taylor

Federal Reserve Bank of St. Louis Review, May/June 2010, 92(3), pp. 165-76. 

Great Moderation -> Great Deviation -> Great Recession
The interventions taken before, during and after the crisis did more harm than good (deviation from what was working well)
Avoiding further debt-increasing and wasteful discretionary stimulus packages, which do little to stimulate GDP
Fiscal policy should focus on reducing the deficit and the growth of the debt-to-GDP ratio
Monetary policy: similar as fiscal policy

Notes on "Corporation tax: Easy for multinationals to avoid?" (Ian Pollock)

Corporation tax: Easy for multinationals to avoid?
By Ian Pollock, Business reporter, BBC News 



(not finished)

Notes on "The right way to hedge" (McKinsey 2010)

The Right Way to Hedge
Bryan Fisher and Ankush Kumar, McKinsey 2010

Hedging against siloed business risk is a problem that aggregated risk across the broad enterprise could also include indirect risks.
To identify a company's true economic exposure, it is important to determine the natural offsets across business.
Hedging requires knowing total costs and benefits.
And only hedge the true risks

Notes on "The Capital Structure Puzzle: The Evidence Revisited" (by Michael J. Barclay and Clifford W. Smith)

The Capital Structure Puzzle: The Evidence Revisited
by Michael J. Barclay and Clifford W. Smith, University of Rochester
Journal of Applied Corporate Finance

Three main groups of corporate financial policies: taxes, contracting costs and information costs
Taxes: higher yields effectively reduce the tax advantage of debt over equity
Contracting costs: the use of debt rather than equity reduces what economists call the agency costs of equity - the reduction in firm value arises from the separation of ownership and control in large, public companies with widely dispersed shareholders
Information costs: market timing, signaling (managers have better information than investors), pecking order

Notes on "Cash and Working-Capital Discipline" (CFO research services)

Cash and Working-Capital Discipline
CFO research services in collaboration with American Express

Creating a secure foundation for growth
When ready availability of credit evaporated in the recent financial crisis, midsize companies lost little time in becoming more financially disciplined. They slashed costs and paid down debt at a ferocious pace, while working to eliminate excess inventory and improve collections in a competitive buyer's market for goods and services.
Maintaining the level of discipline isn't easy.

Constant pressure on working-capital improvement
Diligence - not innovation - is the essence of working capital improvement.
Survey results suggest that midsize firms have been blocking and tackling a lot in recent years - working hard to extract payments from increasingly distressed customers, negotiate more favorable terms with suppliers, and reduce inventory levels while maintaining overall margins.

Lack of bargaining power: A challenge for midsize firms
The intense scrutiny that midsize companies are applying to their receivables flows from a simple fact: when business conditions deteriorate and a buyer's market for goods and services develops, the ability to convert receivables to cash suffers.