Interbank Lending, Collateral, and the 2007 Liquidity Crisis

2008 ◽  
Author(s):  
Christian Ewerhart ◽  
Jens Tapking
Keyword(s):  
Liquidity Crisis ◽  
Interbank Lending

Money creation, debt, and justice

2021 ◽  
pp. 1470594X2199973
Author(s):  
Peter Dietsch
Keyword(s):  
Commercial Banks ◽  
Central Banks ◽  
Private Bank ◽  
Access To Credit ◽  
Financial Architecture ◽  
Theories Of Justice ◽  
Money Creation ◽  
The Creation ◽  
Interbank Lending ◽  
Alternative Designs

Theories of justice rely on a variety of criteria to determine what social arrangements should be considered just. For most theories, the distribution of financial resources matters. However, they take the existence of money as a given and tend to ignore the way in which the creation of money impacts distributive justice. Those with access to collateral are favoured in the creation of credit or debt, which represents the main form of money today. Appealing to the idea that access to credit confers freedom, and that inequalities in this freedom are morally arbitrary, this article shows how the advantage to those with collateral plays out in different ways in today’s economy. The article identifies several forms of bias inherent in money creation, and its subsequent destruction: loans from commercial banks to individuals and corporations, interbank lending, lending from central banks to commercial banks, and selective bail-outs by central banks. These are not mere inequalities: they are unjust since alternative designs of the financial architecture exist that would significantly reduce them. The paper focuses on one possible reform with the potential to address several of the types of bias identified, namely the separation of money creation from private bank credit.

Risk Factors in Equilibrium Models of Open Economies

2010 ◽  
pp. 23-28
Author(s):  
D. Kuz'min
Keyword(s):  
Risk Factors ◽  
Financial Crisis ◽  
Financial Markets ◽  
Global Financial Crisis ◽  
Household Consumption ◽  
Equilibrium Models ◽  
Government Consumption ◽  
Cyclic Processes ◽  
The Usa ◽  
Liquidity Crisis

World liquidity crisis, which started in the USA in 2007, is reputed to be the first full-fledged global financial crisis. The liquidity crisis became global exactly due to the influence of large economies' national financial markets on many small ones. The analysis of the crisis expansion and development in these states (the USA, China, Iceland, Mexico, CEE countries) demonstrated that not only working accounts and reserves, but also foreign and internal borrowings, and therefore, household consumption, investments and government consumption proved to be affected by cyclic processes.

scholarly journals Do Central Bank Liquidity Facilities Affect Interbank Lending Rates?

2009 ◽  
Author(s):  
Jens Henrik Eggert Christensen ◽  
Jose A. Lopez ◽  
Glenn D. Rudebusch
Keyword(s):  
Central Bank ◽  
Lending Rates ◽  
Interbank Lending

scholarly journals An Agent-Based Approach to Interbank Market Lending Decisions and Risk Implications

2018 ◽  
Author(s):  
Anqi Liu ◽  
Cheuk Yin Jeffrey Mo ◽  
Mark E. Paddrik ◽  
Steve Y. Yang
Keyword(s):  
Learning Algorithm ◽  
Risk Preferences ◽  
Interbank Market ◽  
Agent Based ◽  
Market Structures ◽  
Key Characteristics ◽  
Interbank Lending ◽  
Lending Decisions ◽  
Relationship Of ◽  
The Relationship

In this study, we examine the relationship of bank level lending and borrowing decisions and the risk preferences on the dynamics of the interbank lending We develop an agent-based model that incorporates individual bank decisions using the temporal difference reinforcement learning algorithm with empirical data of 6600 S. banks. The model can successfully replicate the key characteristics of interbank lending and borrowing relationships documented in the recent literatur A key finding of this study is that risk preferences at individual bank level can lead to unique interbank market structures which are suggestive of the capacity that the market responds to surprising

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