How should we expect firms to communicate with their shareholders in the presence of uncertainty? This paper studies a model of corporate communication in which cash flow variance is priced and stochastic. The model rationalizes ``biases'' for reports that are internally consistent and confirm market priors. Managers prioritize \textit{consistency} over \textit{confirmation} when cash flows have higher variance or when the signal space is larger. Ex-ante,...

We present a model of secured lending in which borrowers and lenders agree to disagree about collateral values. Lenders' beliefs distort equilibrium prices of collateralized assets, and the extent to which lenders' beliefs distort prices is mediated by borrower riskiness. Specifically, prices are more reflective of lenders' beliefs when borrowers are riskier and more reflective of borrowers' beliefs when borrowers are safer. Disagreement in a...