CRISIS OF CONFIDENCE IN DEBT MARKETS

José Luis Miralles-Marcelo, Julio Daza-Izquierdo

Abstract


The aim of this study is to analyze the sources of thecurrent loss of confidence in the Spanish Public Debt Market, its economicconsequences and possible solutions for this problem. To that end, we focus ourattention on the risk premium risk, factors related to it measure, the negativerole of the rating agencies and the default risk of the financial system.Finally, we present some solutions in form of macroecomic prudential measuresthat could avoid new financial crisis.

Keywords


Public Debt, Crisis of Confidence, Premium Risk, Procyclical Rating, Default Risk.



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