What is Mortgage Recast? Mortgage recast (also known as loan recast or re-amortization) is a strategy by which homeowners can reduce their monthly mortgage payments and save on the interest paid over the life of the loan. It allows borrowers to pay a large, lump-sum amount toward their principal in order to reduce their monthly…
What is the Multilateral Investment Guarantee Agency (MIGA)? The Multilateral Investment Guarantee Agency, abbreviated as MIGA, is an international agency constituted to promote large scale foreign investment projects in developing countries. MIGA specializes in facilitating high-risk investments in low-income countries and supports projects that are socially, economically, and environmentally sustainable. Headquartered in Washington DC, U.S., MIGA is…
What is Quantitative Tightening? Quantitative tightening, also known as balance sheet normalization, is a type of monetary policy followed by central banks. It simply means that a central bank reduces the pace of reinvestment of proceeds from maturing government bonds, and is the exact opposite as the monetary stance of quantitative easing. Quantitative tightening also…
What is Crisis Management? Crisis management involves dealing with crises in a manner that minimizes damage and enables the affected organization to recover quickly. Dealing properly with a crisis can be especially important for a company’s public relations. Crises come in several forms, and it is recommended that a company be prepared ahead of time…
What is Monetarism? The term monetarism refers to a macro-economic concept, according to which government intervention in the economy in the form of the management of money supply is key to economic stability. The premise of monetarism lies in the idea that the total amount of money in circulation in an economy determines the rate…
What is the Average Collection Period? The average collection period amount of time that passes before a company collects its accounts receivable (AR). In other words, it refers to the time it takes, on average, for the company to receive payments it is owed from clients or customers. The average collection period must be monitored…
What is an Auction Market? An auction market is a market where the price is determined by the highest price the buyer is willing to pay (bids), and the lowest price the seller is willing to take (offers). Bids and offers are matched for a trade to occur. How Auction Markets Work Auction markets are…
What is Moral Suasion? The term “moral suasion” refers to the usage of rhetorical appeals, implicit threats, and persuasion in order to get a person or a group of people to change their behavior. Thus, moral suasion relies on verbal techniques rather than the use of force or coercion to get people to act in…
What is a Tuck-in Acquisition? A tuck-in acquisition involves the acquisition of a smaller company and integrating it into the acquirer’s platform. The acquirer is usually a large company that possesses the large infrastructure that the smaller company lacks. The smaller company usually has a strong owner but lacks the infrastructure, administrative resources, and/or access…
What is Diversification? Diversification is a technique of allocating portfolio resources or capital to a mix of different investments. The ultimate goal of diversification is to reduce the volatility of the portfolio by offsetting losses in one asset class with gains in another asset class. A phrase commonly associated with diversification: “Do not put all…
