, these flows are constrained and collateral is needed. Both the volume, the value, and the composition of collateral matter …. We make a distinction between "outside collateral" and "inside collateral". The use of inside assets, such as loans …, creates a "collateral pyramid", in that cash flows from one loan can be pledged to secure another. Through collateral pyramids …

This paper investigates contagion in financial networks through both debt and collateral markets. We find that the role … of collateral is mitigating counterparty exposures and reducing contagion but has a phase transition property. Contagion … can change dramatically depending on the amount of collateral relative to the debt exposures. When there is an abundance …

Default ; Collateral ; Collateral Valuation …

fundamental risk. This effect is separate from the liquidation externality caused by fire sales of seized collateral upon default …

This theoretical paper explores the effects of costly and non-costly collateral on moral hazard, when collateral value … may fluctuate. Given that all collateral is costly, stochastic collateral will entail the same positive incentive effects … as nonstochastic collateral, provided the variation in collateral value is modest. If it is large, the incentive effects …

Financial lubrication in markets is indifferent to margin posting via money or collateral; the relative price(s) of … money and collateral matter. Some central banks are now a major player in the collateral markets. Analogous to a coiled … spring, the larger the quantitative easing(QE) efforts, the longer the central banks will impact the collateral market and …

particular for collateral that saves more on regulatory capital …

particular for collateral that saves more on regulatory capital …

This paper presents a new model for pricing OTC derivatives subject to collateralization. It allows for collateral … risk alone is not overly important in determining credit-related spreads. Only accounting for both collateral arrangement … collateral agreements on risk measurements. Our findings indicate that there are important interactions between market and credit …