EconPapers    
Economics at your fingertips  
 

Payment system disruptions and the Federal Reserve following September 11, 2001

Jeffrey Lacker

No 03-16, Working Paper from Federal Reserve Bank of Richmond

Abstract: The monetary and payment system consequences of the September 11, 2001, terrorist attacks are reviewed and compared to selected U.S. banking crises. Interbank payment disruptions appear to be the central feature of all the crises reviewed. For some the initial trigger is a credit shock, while for others the initial shock is technological and operational, as in September 11, but for both types the payments system effects are similar. For various reasons, interbank payment disruptions appear likely to recur. Federal Reserve credit extension following September 11 succeeded in massively increasing the supply of banks? balances to satisfy the disruption-induced increase in demand and thereby ameliorate the effects of the shock. Relatively benign banking conditions helped make Fed credit policy manageable. An interbank payment disruption that coincided with less favorable banking conditions could be more difficult to manage, given current daylight credit policies.

Keywords: Federal Reserve banks; Monetary policy; Payment systems (search for similar items in EconPapers)
Date: 2003
New Economics Papers: this item is included in nep-mac and nep-mon
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (10)

Downloads: (external link)
http://www.richmondfed.org/publications/research/w ... rs/2003/wp_03-16.cfm (text/html)
https://www.richmondfed.org/-/media/RichmondFedOrg ... 2003/pdf/wp03-16.pdf Full text (application/pdf)

Related works:
Journal Article: Payment system disruptions and the federal reserve following September 11, 2001 (2004) Downloads
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: https://EconPapers.repec.org/RePEc:fip:fedrwp:03-16

Ordering information: This working paper can be ordered from

Access Statistics for this paper

More papers in Working Paper from Federal Reserve Bank of Richmond Contact information at EDIRC.
Bibliographic data for series maintained by Christian Pascasio ().

 
Page updated 2025-04-02
Handle: RePEc:fip:fedrwp:03-16