Bond Markets in Latin America: On the Verge of a Big Bang?

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Eduardo Borensztein
MIT Press, 2008 - History - 305 pages
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Developing local bond markets is high on the policy agenda of Latin America. Bondmarkets are an essential component of a well-functioning financial market. Facilitating the effortsof public and private borrowers to issue domestic-currency-denominated, long-term, fixed-rate bondsinsulates them from the rollover and balance sheet risks that have been central elements in pastfinancial crises. In addition, a robust bond market is a way for nonfinancial firms to retain theircapacity to borrow when the banking system grows reluctant to lend. Latin American bond markets aregrowing, and may even approach a "big bang"-like surge, although significant challengesremain. This first comprehensive examination of the importance of local bond market development inLatin America provides conceptual and comparative assessments, case studies of six countries,surveys of firms and investors, and a cross-country economic analysis of the determinants of bondmarket development. The book's case studies of Argentina, Brazil, Chile, Colombia, Mexico, andUruguay, written by country experts, follow a common methodology, with each offering a history ofthat country's bond market development, a comprehensive and unique data set on both private andpublic bond markets, surveys of firms and investors, and (in many chapters) firm-level analysis. AWeb appendix makes available the unique data sets, including results of specially designed surveysof firms and investors participants, used in the book's studies. Eduardo Borensztein is an Advisor,Research Department, at the International Monetary Fund. Kevin Cowan is a Senior Economist,Financial Stability Division, at the Central Bank of Chile. Barry Eichengreen is George C. Pardeeand Helen N. Pardee Professor of Economics and Political Science at the University of California,Berkeley, and the author of Global Imbalances and the Lessons of Bretton Woods (MIT Press, 2006) andother books. Ugo Panizza is Chief of the Debt and Finance Analysis Unit in the Division onGlobalization and Development Strategies at the United Nations Conference on Trade andDevelopment.ContributorsCamila Aguilar, Patrick Bolton, Eduardo Borensztein, Matías Braun, IgnacioBriones, Mauricio Cárdenas, Andre L. Carvalhal da Silva, Sara G. Castellanos, Kevin Cowan, Julio deBrun, Barry Eichengreen, Roque B. Fernández, Xavier Freixas, Néstor Gandelman, Herman Kamil, RicardoP. C. Leal, Lorenza Martínez, Marcela Meléndez, Ugo Panizza, Sergio Pernice, Arturo C. Porzecanski,Natalia Salazar, Jorge Streb


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1 Building Bond Markets in Latin America
2 How Can Emerging Market Economies Benefit from a Corporate Bond Market?
3 Development of the Mexican Bond Market
4 Corporate Bond Markets in Argentina
5 Development of Colombian Bond Markets
6 Development of the Chilean Corporate Bond Market
7 Development of the Brazilian Bond Market
8 The FixedIncome Market in Uruguay
A CrossCountry View
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About the author (2008)

Barry Eichengreen is George C. Pardee and Helen N. Pardee Professor of Economics and Political Science at the University of California, Berkeley. He is the author of Capital Flows and Crises (MIT Press, 2002) and other books.

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