assets. This was primarily driven by an increase in holdings of debt securities. HSBC’s operations in Europe, reported a rise in the credit risk arbitrage portfolio reflecting strong investor demand for commercial paper while, in Hong Kong, the increase was driven by the deployment of increased commercial surplus. During the financial crisis trading assets increased by 11 percent because of the
Financial Leverage Ratio
It measures the relationship between total assets and the stockholders’ equity that finances the assets.
Both company shows pretty high financial leverage
High financial leverage means they are highly
dependent on debt when financing assets.
Total Asset Turnover Ratio
Total Asset Turnover measures the sale generated
per
asset price exceeds 40%
The bursting of a bubble is accompanied by recession, low inflation (even deflation).
Irving Fisher (1911), John M. Keynes(1936), Milton Friedman (2003):
Asset Price: Interest Rate, Inflation Rate, Risk Premium,
Expected Growth
Money
Weaknesses in the global financial system
The crisis has, indeed, unveiled serious weaknesses in the functioning of our global f
financial ratios from their financial statements.
Ⅱ. Financial Ratio analysis
1. Liquidity
Liquidity refers to a company's ability to meet its current maturing debts. And it focuses on the relationship between current assets and current liabilities. With it, Creditors and analysts evaluate a company's short-term financial strength.
1.1. cash ratio
it is a means to measure the
financial statement and information, less dynamic, stable industries were chosen from each country so that there are fewer aberrations. The paper initially evaluates different ratios representing short-term solvency, asset utilization/turnover, long-term solvency or financial leverage, profitability and market values for companies in the same industry within same country. Then, the paper further