Money, liquidity, and monetary policy

Tobias Adrian () and Hyun Song Shin

No 360, Staff Reports from Federal Reserve Bank of New York

Abstract: In a market-based financial system, banking and capital market developments are inseparable, and funding conditions are closely tied to fluctuations in the leverage of market-based financial intermediaries. Offering a window on liquidity, the balance sheet growth of broker-dealers provides a sense of the availability of credit. Contractions of broker-dealer balance sheets have tended to precede declines in real economic growth, even before the current turmoil. For this reason, balance sheet quantities of market-based financial intermediaries are important macroeconomic state variables for the conduct of monetary policy.

Keywords: Intermediation (Finance); Liquidity (Economics); Brokers; Economic indicators; Financial institutions (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-cba, nep-mac and nep-mon
Date: 2009
View list of references View citations in EconPapers

Downloads: (external link)
http://www.newyorkfed.org/research/staff_reports/sr360.html (text/html)
http://www.newyorkfed.org/research/staff_reports/sr360.pdf (application/pdf)

Related works:
Journal Article: Money, Liquidity, and Monetary Policy (2009)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: http://EconPapers.repec.org/RePEc:fip:fednsr:360

Ordering information: This working paper can be ordered from
http://www.ny.frb.org/rmaghome/staff_rp/

Access Statistics for this paper

More papers in Staff Reports from Federal Reserve Bank of New York
Contact information at EDIRC.
Series data maintained by Diane Rosenberger ().