Publications

July 1991
Case

Managing the U.S. Dollar in the 1980s

By: W. Carl Kester and Richard P. Melnick

Provides numerical data and alternative explanations concerning the U.S. dollar's rise and subsequent fall in value from 1981 through 1987. Students are challenged to study the evidence and make their own inferences concerning the dollar's movements and the degree of... View Details

Keywords: Macroeconomics; Currency Exchange Rate; Price; Theory; United States

Article

Anomalies: Foreign Exchange

By: K. A. Froot and R. Thaler

Keywords: Currencies; Exchange Rates; International Macroeconomics; Monetary Policy; Currency Controls; Fixed Exchange Rates; Floating Exchange Rates; Currency Bands; Currency Zones; Currency Areas; Rational Expectations; Asset Pricing

May 1990
Article

Chartists, Fundamentalists, and Trading in the Foreign Exchange Market

By: J. Frankel and K. A. Froot

Keywords: Currencies; Exchange Rates; International Macroeconomics; Monetary Policy; Currency Controls; Fixed Exchange Rates; Floating Exchange Rates; Currency Bands; Currency Zones; Currency Areas; Rational Expectations; Asset Pricing

April 1988 (Revised May 1992)
Case

Gaz de France

By: W. Carl Kester

The treasurer of Gaz de France is an aggressive, proactive manager of his company's liability structure, running one of the largest swap books of any non-financial corporation in the world. Currency futures, interbank forwards, and currency options are also frequently... View Details

Keywords: Decisions; Borrowing and Debt; Currency Exchange Rate; Credit Derivatives and Swaps; Policy; Management; Organizational Structure; Energy Industry; Europe

September 1987 (Revised November 1992)
Background Note

Note on Transaction and Translation Exposure

By: W. Carl Kester and Richard P. Melnick

Describes the transaction and translation exposures that companies doing business internationally face when foreign exchange rates change. Also discusses how to measure and cover both types of exposure. Covering techniques are demonstrated using examples of forward... View Details

Keywords: Currency Exchange Rate; International Finance

January 1987 (Revised September 1991)
Case

Walt Disney Co.'s Yen Financing

By: W. Carl Kester and William B. Allen

Walt Disney is considering hedging future yen inflows from Disney Tokyo. It is evaluating techniques using FX Forwards, swaps, and Yen term borrowings. Goldman Sachs presents a rather unusual but potentially attractive solution: Disney could issue ECU Eurobonds and... View Details

Keywords: Borrowing and Debt; Currency; Bonds; Valuation; Tokyo

1986
Other Unpublished Work

Capital Flight, Policy Credibility, and the Option Value of Foreign Exchange

By: K. A. Froot and S. van Wijnbergen

Keywords: Trade Policy; Capital Controls; Liberalization; Currency; International Finance; Capital

January 1982
Background Note

Exchange Rate Determination and Foreign Exchange Equilibrium Conditions, Study Note

By: Thomas R. Piper

Keywords: Currency Exchange Rate; International Finance

December 1981 (Revised July 1991)
Case

Ocean Drilling, Inc.

By: Thomas R. Piper

Management must choose between two mutually exclusive bids to build two drilling rigs. Both bids involve attractive export credit financing denominated in foreign currencies. View Details

Keywords: Credit; Currency; Financing and Loans; Bids and Bidding; Natural Environment

December 1980 (Revised January 1994)
Case

International Foodstuffs

By: David E. Bell

Describes three fairly routine instances in which considerations of risk exposure in foreign exchange are necessary. The three are a delayed payment for a grain shipment, a foreign subsidiary facing devaluation of its domestic currency, and a foreign acquisition. The... View Details

Keywords: Currency Exchange Rate; Risk and Uncertainty; International Relations; Mergers and Acquisitions; Money; International Finance; Financial Services Industry