The Failure Mechanics of Dealer Banks
39 Pages Posted: 5 May 2010 Last revised: 3 Nov 2013
Date Written: March 1, 2010
I explain the key failure mechanics of large dealer banks, and some policy implications. This is not a review of the financial crisis of 2007-2009. Systemic risk is considered only in passing. Both the financial crisis and the systemic importance of large dealer banks are nevertheless obvious and important motivations. See also, http://ssrn.com/abstract=1699600.
Keywords: Liquidity, dealer banks, OTC markets, financial crisis
JEL Classification: G10, G15, G24, G20
Suggested Citation: Suggested Citation