The ECB has accepted increasing amounts of rubbish collateral since the crisis started leading to exposure to serious … some commentators to argue that the ECB needs "fiscal back-up" to cover any potential losses to be able to continue … pursuing price stability. This Brief argues that fiscal backing is not necessary for the ECB for three reasons. Firstly, the …

collateral scarcity premia, but this impact is offset by the beginning of the ECB Securities Lending Programme. …Collateral plays a very important role in financial markets. Without easy access to high-quality collateral, dealers … economy through increased financing costs. The role of collateral has become increasingly significant since the global …

With an emphasis on contributing to macroeconomic pedagogy we examine the collateral multiplier by comparing it to the … creating deposits, the collateral multiplier is a measure of the shadow banking system's ability to inter- mediate sovereign … debt by creating shadow money. It also measures the degree of re-use of sovereign debt as collateral. In this setup, the …

This paper studies the emergence of sovereign bond yield spreads in the Eurozone prior to the financial crisis. While … Eurosystem's move from unconditional to conditional collateral eligibility of sovereign bonds, as part of the 2005 Single List … cycles deviate most from the average Eurozone cycle. In contrast, spreads did not arise in response to adverse macroeconomic …

The ECB has accepted increasing amounts of rubbish collateral since the crisis started leading to exposure to serious … some commentators to argue that the ECB needs “fiscal back-up” to cover any potential losses to be able to continue … pursuing price stability. This Brief argues that fiscal backing is not necessary for the ECB for three reasons. Firstly, the …

study the intended and unintended consequences of asset purchases in the repo market with Bund collateral. Bunds that are …

Central-bank collateral policy governs the convertibility of assets into central-bank money provided directly by the … central bank. Focusing on government bonds, we develop clean identification of variation in such convertibility by exploiting … maturities. Our findings imply that central-bank money is priced in the market and that a central bank can move and shape the …