The fact that trade credit and loans commove, or are unrelated at best, means that bank-dependent SMEs are seriously credit constrained.
Loans and trade payables positively commove in response to changes in sales or the cost of sales, implying the two are complements.
We not only find that trade credit and loans positively commove in response to loan shocks, which is what previous studies have found, but also that trade credit and loans positively commove in response to trade credit shocks, which has not been previously documented.
Another possible scenario is that profit-driven private capital flows that commove
with remittances represent the driving force behind the positive relationship between remittances and the real exchange rate.
This may not be a problem for identifying whether the resulting index is driven mainly by business cycle considerations per se, but will affect the degree to which such indexes commove
with more continuous aggregate measures of production over the cycle.
52: "Non entra Amor a rinovar nel seno, / che ragion congelo la fiamma antica; / v'entra pietate in quella vece almeno, / pur compagna d'Amor, benche pudica / e lui commove
in guisa tal ch'a freno / puo ritener le lagrime a fatica.