A strong and competitive small and medium sized enterprise (SME) sector is critical to a strong and competitive economy. Its direct contribution amounts to approximately 45 percent of the overall Canadian economy. But the SME sector’s role goes far beyond its direct contribution to GDP. SMEs employ the majority of Canadians and are a key foundation in all communities throughout Canada. SMEs are also where many of Canada’s innovative ideasare born, laying the groundwork for a more productive Canadian economy.
Essential to the future growth potential of the SME sector is a strong and competitive banking sector. Banks, credit unions and caisse populaires directly contribute 3.3 percent of GDP. Indirectly, their contribution is considerably greater. For example, the provision of financing and banking services for SMEs at competitive rates is essential to the future success of the Canadian economy.
Uncertainty about the expected recovery value is a main caveat when pricing credit contingent claims in reduced form models. This article introduces an empirical model of the bond price which allows the simultaneous estimation of both, default intensity parameters and recovery rates. The model addresses some peculiarities of risky sovereign debt. While under distress sovereign bond prices do not necessarily converge to par at maturity, recent experience from coercive restructurings show that recovery is comprised mostly of an equal compensation to all bondholders. A parsimonious model with these features is applied in a case study of the Argentine debt crisis 2000–2002. Theresulting recovery value estimated from Argentine global bonds starts out above 50% and falls to 25% after default. The arrival of an USD 40 billion aid package arranged by the IMF appears to raise the recovery ratio while leaving the implied default parameters mostly unaffected. This provides evidence that bond investors did not believe in this cure.
When economy minister Roberto Lavagna announced the result of the Argentine restructuring offer this March, investors had tendered 76% of all eligible claims into the exchange. The restructuring forced creditors to accept the largest haircut seen so far on the sovereign bond market. Even though the offer was scolded by most players, including the IMF, it neatly matches what investors expected from the Argentine default in 2001. This analysis shows how the recovery expectation implied from Argentine global bond prices evolved during the crisis and finally hit the after-default price range in the mid-20s.
To examine how a low-carbohydrate diet affects cognitive performance, women participated in one of two weight-loss diet regimens. Participants self-selected a low- carbohydrate (n=9) or a reduced-calorie balanced diet similar to that recommended by the American Dietetic Association (ADA diet) (n=10). Seventy-two hours before beginning their diets and then forty-eight hours, one, two, and three weeks after starting, participants completed a battery of cognitive tasks assessing visuospatial memory, vigilance attention, memory span, a food-related paired-associates a food Stroop, and the Profile of Moods Scale (POMS) to assess subjective mood.
