lent on) can be sold, and recursive use of securities as collateral allows agents to leverage their positions. A binding …

lent on) can be sold, and recursive use of securities as collateral allows agents to leverage their positions. A binding …

Securities markets theory includes repo and distinguishes shorting from issuing. Here we revisit whether trading alone …-hypothecation (e.g., through segregated haircut rules or explicit leverage constraints on haircut collecting dealers), (1) trading …

Securities markets theory includes repo and distinguishes shorting from issuing. Here we revisit whether trading alone …-hypothecation (e.g., through segregated haircut rules or explicit leverage constraints on haircut collecting dealers), (1) trading …

think about default, collateral, and leverage as the central features of the financial/macro economy, despite their complete …

change in fundamentals. In C-models, the ability to leverage an asset always generates over-investment compared to Arrow … robustly destroys competitive equilibrium. The need for collateral would seem to cause under-investment. Our analysis … illustrates a countervailing force: goods that serve as collateral yield additional services and are therefore over-valued and …

specialness in repo markets, expressing the physical possession value of a security. We examine how the coordinated central banks …

specialness in repro markets, expressing the physical possession value of a security. We examine how the coordinated central banks …

We show that financial innovations that change the collateral capacity of assets in the economy can affect investment … even in the absence of any shift in utilities, productivity, or asset payoffs. First we show that the ability to leverage …

We discuss how leverage can be monitored for institutions, individuals, and assets. While traditionally the interest … rate has been regarded as the important feature of a loan, we argue that leverage is sometimes even more important …. Monitoring leverage provides information about how risk builds up during booms as leverage rises and how crises start when …