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The Role of Bank Capital in the Propagation of Shocks

Staff Working Paper 2008-36 Césaire Meh, Kevin Moran
Recent events in financial markets have underlined the importance of analyzing the link between the financial health of banks and real economic activity. This paper contributes to this analysis by constructing a dynamic general equilibrium model in which the balance sheet of banks affects the propagation of shocks.

Combining Canadian Interest-Rate Forecasts

Staff Working Paper 2008-34 David Bolder, Yuliya Romanyuk
Model risk is a constant danger for financial economists using interest-rate forecasts for the purposes of monetary policy analysis, portfolio allocations, or risk-management decisions. Use of multiple models does not necessarily solve the problem as it greatly increases the work required and still leaves the question "which model forecast should one use?"
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