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Liquidity Effects and the Monetary Transmission Mechanism

Christiano, Lawrence J. - 1992

liquidity effects. This paper discusses the basic frictions and mechanisms underlying this new class of models and investigates … long-lasting, quantitatively significant liquidity effects, as well as persistent increases in aggregate economic activity …

Persistent link: https://www.econbiz.de/10012475008

Rollover Risk and Market Freezes

Acharya, Viral V. - 2010

The crisis of 2007-09 has been characterized by a sudden freeze in the market for short-term, secured borrowing. We present a model that can explain a sudden collapse in the amount that can be borrowed against finitely-lived assets with little credit risk. The borrowing in this model takes the...

Persistent link: https://www.econbiz.de/10012462978

Cash Holdings and Credit Risk

Acharya, Viral V. - 2011

liquidity may be related positively to the longer-term probability of default. Our empirical analysis confirms these predictions …

Persistent link: https://www.econbiz.de/10012461663

Crowding Out Or Crowding In? The Economic Consequences of Financing Government Deficits

Friedman, Benjamin M. - 1978

The prevailing view of the economic consequences of financing government deficits, as reflected in the recent economics literature and in recent public policy debates, reflects serious misunderstandings. Debt-financed deficits need not "crowd out" any private investment, and may even "crowd in"...

Persistent link: https://www.econbiz.de/10012478866

On the Fiscal Implications of Twin Crises

Burnside, Craig - 2001

This paper explores the implications of different strategies for financing the fiscal costs of twin crises for inflation and depreciation rates. We use a first-generation type model of speculative attacks which has four key features: (i) the crisis is triggered by prospective deficits; (ii)...

Persistent link: https://www.econbiz.de/10012470447

Sovereign Debt, Government Myopia, and the Financial Sector

Acharya, Viral V. - 2011

What determines the sustainability of sovereign debt? We develop a model where myopic governments seek popularity but can nevertheless commit credibly to service external debt. They do not default when debt is low because they would lose access to debt markets and be forced to reduce spending;...

Persistent link: https://www.econbiz.de/10012461116

Liquidity, Liquidity Everywhere, Not a Drop to Use - Why Flooding Banks with Central Bank Reserves May Not Expand Liquidity

Acharya, Viral V.; Rajan, Raghuram Govind - National Bureau of Economic Research - 2022

reserves, which are also claims on liquidity. In ordinary times, when these claims are not called on, central bank balance … sheet expansion will typically enhance the net availability of liquidity to the system. However, in times of stress when … these offsetting claims on liquidity are exercised, the demand for liquidity can be significantly more. Furthermore, liquid …

Persistent link: https://www.econbiz.de/10012814455

The Value of Intermediate Targets in Implementing Monetary Policy

Friedman, Benjamin M. - 1984

This paper reports empirical results indicating that there is no compelling evidence in favor of singling outany one variable as "the intermediate target" of monetary policy. Of the variables considered here - including money (M1), credit, a long-term interest rate, and whichever of either...

Persistent link: https://www.econbiz.de/10012477599

Monetary Policy with a Credit Aggregate Target

Friedman, Benjamin M. - 1982

The principal criteria for the selection of an intermediate target for monetary policy are (1) that the target be closely related to the nonfinancial objectives of monetary policy, (2) that it contain information about the future movements of those relevant aspects of the nonfinancial economy,...

Persistent link: https://www.econbiz.de/10012478125

Debt Management Policy, Interest Rates, and Economic Activity

Friedman, Benjamin M. - 1981

The maturity structure of the U.S. government's outstanding debt has undergone large changes over time, at least in part because of shifts in the Treasury's debt management policy. During most of the post World War I1 period, an emphasis on short-term issues rapidly reduced the debt's average...

Persistent link: https://www.econbiz.de/10012478281