suggests that although bank lending contracted during the crisis, bond financing actually increased to make up much of the gap …

reserve requirements. We also examine the potential for balance-sheet cost frictions to distort banks' lending decisions. We … such a large quantity of bank reserves could lead to overly expansive bank lending as the economy recovers, regardless of … lending in a frictionless model of the current banking system, in which interest is paid on reserves and there are no binding …

explain, through a series of examples, why banks are currently holding so many reserves. The examples show how the quantity of …' effects on bank lending. We also argue that a large increase in bank reserves need not be inflationary, because the payment of …

two-agent financial intermediary sector within a dynamic model of the macroeconomy. Banks are financed by issuing risky … financial-sector assets. The procyclicality of the banking sector is due to its risk-based funding constraints, which give a …