1. Price Pressure in the Government Bond Market.
- Author
-
Greenwood, Robin and Vayanos, Dimitri
- Subjects
BOND market ,ECONOMIC models ,INTEREST rates ,PRICES ,CONSUMER preferences ,GOVERNMENT securities - Abstract
The article presents research investigating the term structures in interest rates within the government bond market, highlighting the role of price pressure. Introductory information is given describing the "preferred-habitat" theory of bond selection and advocating its application within standard economic theory. Two economic case studies are provided through the preferred habitat method, including the 2004 British pension reforms and the U.S. Treasury buyback program of 2000-2001. Long term interest rate shifts which occurred in response to these events are illustrated and explained through the paradigm.
- Published
- 2010
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