liquidity over incentives. Optimal interventions with commitment call for large, long-term subsidies in excess of what is … required to restore liquidity. …

particular, we do not find that worse performing banks began hoarding liquidity and indiscriminately reducing their lending. …

consists of a web of specialized financial institutions that conduct credit, maturity, and liquidity transformation without … direct, explicit access to public backstops. The lack of such access to sources of government liquidity and credit backstops …

specialized financial institutions that conduct credit, maturity, and liquidity transformation without direct, explicit access to … public backstops. The lack of such access to sources of government liquidity and credit backstops makes shadow banks …

Liquidity hoarding by banks and extreme volatility of the fed funds rate have been widely seen as severely disrupting … present empirical evidence on banks' precautionary hoarding of reserves, their reluctance to lend, and extreme fed funds rate … volatility. We develop a model with credit and liquidity frictions in the interbank market consistent with the empirical results …