While bond issuance has acquired a subsidy, equity issuance has grown more expensive. To limit moral hazard, crisis bailouts were crafted so as to make shareholders suffer; thus AIG’s shareholders were taken to the cleaners even as the banks that had incautiously bought its derivatives got off scot-free. As a result, equity investors today do not expect the government to rescue them. In contrast to bondholders, shareholders see banking behemoths as scarily complex, not comfortingly protected.
债券发行获得了补贴,而股票发行成本变得更为高昂。为了控制道德风险,有关方面制定的危机纾困计划让股东受损;因此,即使那些不慎购买了美国国际集团(AIG)衍生品的银行平安脱逃了,AIG的股东却损失惨重。结果,股票投资者现在不指望政府会拯救他们。与债券持有者相比,股票持有者觉得银行业巨擘复杂得让人害怕,而没有受到让人安稳的保护。
This too-big-to-fail effect shows up clearly in the prices of equity and debt. A non-financial corporation choosing between equity issuance and bond issuance could reasonably go either way. For example, Coca-Cola’s shares sell for 17 times next year’s expected earnings, meaning that equity investors demand a return of 5.8 per cent in order to buy the shares. Since Coke can issue long-term bonds at just over 4 per cent, equity is only 1.6 percentage points more costly. By contrast, Bank of America, JPMorgan, and Citigroup face a far larger wedge:7.5 percentage points, 10.4 percentage points and 11.8 percentage points, respectively. Banks frequently moan that equity is expensive. Thanks to regulators’ selective concern with moral hazard, they have a point.
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