We differentiate the liquidity and the quality of private assets in a tractable incomplete-market model with … heterogeneous agents. The model decomposes the convenience yield of government bonds into a "liquidity premium" (flight to liquidity … fluctuations and bond premiums, the model reveals that a sharp reduction in the quality, instead of the liquidity, of private …

funds entering the crisis with higher liquidity buffers were less likely to involve in cash hoarding and more likely to use … March 2020 to examine two channels through which liquidity buffers can reduce procyclicality in the investment fund sector …. First, we find that liquidity buffers reduced outflows during March 2020 only to a limited extent. Second, we find that …

This paper provides a framework to analyse emergency liquidity assistance of central banks on financial markets in … response to aggregate and idiosyncratic liquidity shocks. The model combines the microeconomic view of liquidity as the ability … to sell assets quickly and at low costs and the macroeconomic view of liquidity as a medium of exchange that influences …

Credit market freezes in which debt issuance declines dramatically and market liquidity evaporates are typically … bonds declined, and secondary credit markets became highly illiquid. In this paper we analyze liquidity in bond markets … during financial crises and compare two main theories of liquidity in markets: (1) asymmetric information and adverse …

We develop a rational theory of liquidity sentiments in which the market outcome in any given period depends on agents …