A new textbook by Prof. Löffler has been released: "Finanzierung". It's an introduction to financial theory (in German).
Despite intense criticism, agency credit ratings are still widely used in regulation and risk management. One possible alternative is to replace them with quantitative default risk measures. In a study that is forthcoming in the Journal of Financial Services Research, Prof. Löffler shows that using such measures would reduce systemically relevant losses in bond portfolios and thus help to improve financial stability.
Were the prices of internet and technology stocks really too high in early 2000? Or was the subsequent decline in prices too strong? A study that is forthcoming in the Financial Review favors the second explanation. Whether there was a speculative bubble or not is thus much more difficult to decide than many observers think.
Do popular measures of systemic risk reliably indicate how much financial stability is threatened by individual institutions? A paper to be published in the Journal of Financial and Quantitative Analysis shows that there are many cases in which the measures can give misleading indications and create wrong incentives.