We show that stricter bank liquidity standards can trigger unintended credit booms when there is heterogeneity in …

more than long-term credit. Firms responded by cutting their short-term loans for liquidity management purposes and …, firms increase cash and cut investment. Thus, trade credit offers a substitute source of liquidity that can insulate some … firms from bank liquidity shocks …

I consider banks' role in providing funding liquidity (the ability to raise cash on demand) and market liquidity (the … liquid deposits, thus producing funding liquidity on the liability side of the balance sheet. Deposits are less important in … 21st century banks, but funding liquidity from lines of credit and loan commitments has become more important. Banks also …

Both investors and borrowers are concerned about liquidity. Investors desire liquidity because they are uncertain about … when they will want to eliminate their holding of a financial asset. Borrowers are concerned about liquidity because they … compensation for the illiquidity investors will be subject to. We argue that banks can resolve these liquidity problems that arise …

Banks are unique among financial institutions because they are the cheapest source of liquidity in the economy. Banks … liquidity. Since the cost of reserves falls on all issuers of less liquid liabilities seeking access to payment services …, including non-bank intermediaries, reserves cannot represent a tax on the banking system alone …

-Wicksellian model and then adds banks and a role for bonds in the liquidity management of households and banks. The Banks and Bonds …

failure of other institutions. The reason is that agents in need of liquidity tend to concentrate their holdings in banks …. Thus, a shock to banks disproportionately affects the agents who need liquidity the most, reducing aggregate demand and the …

Can banks maintain their advantage as liquidity providers when they are heavily exposed to a financial crisis? The … deposit rates and inflows during the 2007-09 crisis. Our results indicate that the role of the banking system as a stabilizing … liquidity insurer is not one of the passive recipient, but of an active seeker, of deposits. We find that banks facing a funding …