From the 5th ECB Central Banking Conference

Posted on November 15, 2008 by jck

PPT style presentation
The Global Roots of the Current Financial Crisis and its Implications for Regulation — Raghuram Rajan

Paper
The Global Roots of the Current Financial Crisis and its Implications for Regulation — Raghuram Rajan

Credit “thaw”
“As you know, however, monetary policy actions have not resolved the ongoing strains in financial markets, including interbank funding markets.” B.B.
Policy Coordination Among Central Banks —Ben Bernanke
B.B. talks about the dollar funding shortages, (swap lines are running at over $600 bn, almost as much as the TARP, with the ECB on the hook for over two-thirds of this).

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2 Responses to From the 5th ECB Central Banking Conference

  1. acc says:
    November 17, 2008 at 1:54 pm

    I think David’s mostly right about this. The basic problem is that when financial insurance needs to pay out, only a government with a floating currency and a lot of international credibility has the necessary resources.

    I think the basic problem with Rajan’s plan is that, because it will have to payout to (almost) every bank at the same time, the funds it pays out will be very limited.

  2. David Merkel says:
    November 15, 2008 at 9:38 pm

    I’ve not been crazy about Raghuram Rajan’s ideas on this. I will only point to this post of mine:

    http://alephblog.com/2008/09/02/the-banking-industry-should-learn-from-the-insurance-industry/

    Thanks.