IDEAS home Printed from https://ideas.repec.org/a/bis/bisqtr/0903g.html
   My bibliography  Save this article

US dollar money market funds and non-US banks

Author

Listed:
  • Naohiko Baba
  • Robert N McCauley
  • Srichander Ramaswamy

Abstract

The Lehman Brothers failure stressed global interbank and foreign exchange markets because it led to a run on money market funds, the largest suppliers of dollar funding to non-US banks. Policy stopped the run and replaced private with public funding.

Suggested Citation

  • Naohiko Baba & Robert N McCauley & Srichander Ramaswamy, 2009. "US dollar money market funds and non-US banks," BIS Quarterly Review, Bank for International Settlements, March.
    • Handle: RePEc:bis:bisqtr:0903g
    as

    Download full text from publisher

    File URL: http://www.bis.org/publ/qtrpdf/r_qt0903g.pdf
    Download Restriction: no
    File URL: http://www.bis.org/publ/qtrpdf/r_qt0903g.htm
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Naohiko Baba & Frank Packer & Teppei Nagano, 2008. "The spillover of money market turbulence to FX swap and cross-currency swap markets," BIS Quarterly Review, Bank for International Settlements, March.
    2. Eric Rosengren, 2008. "The economy and markets," Speech 18, Federal Reserve Bank of Boston.
    3. Eric Rosengren, 2008. "The impact of financial institutions and financial markets on the real economy: implications of a 'liquidity lock'," Speech 17, Federal Reserve Bank of Boston.
    4. Lauren A. Hargraves & Robert N. McCauley, 1987. "Eurocommercial paper and U.S. commercial paper: converging money markets?," Quarterly Review, Federal Reserve Bank of New York, vol. 12(Aut), pages 24-35.
    5. Robert N. McCauley & Rama Seth, 1992. "Foreign bank credit to U.S. corporations: the implications of offshore loans," Quarterly Review, Federal Reserve Bank of New York, vol. 17(Spr), pages 52-65.
    6. Patrick McGuire & Goetz von Peter, 2009. "The US dollar shortage in global banking," BIS Quarterly Review, Bank for International Settlements, March.
    7. Baba, Naohiko & Packer, Frank, 2009. "Interpreting deviations from covered interest parity during the financial market turmoil of 2007-08," Journal of Banking & Finance, Elsevier, vol. 33(11), pages 1953-1962, November.
    8. William Dudley, 2008. "May you live in interesting times: the sequel," Proceedings 1071, Federal Reserve Bank of Chicago.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. De Socio, Antonio, 2013. "The interbank market after the financial turmoil: Squeezing liquidity in a “lemons market” or asking liquidity “on tap”," Journal of Banking & Finance, Elsevier, vol. 37(5), pages 1340-1358.
    2. Baba, Naohiko & Packer, Frank, 2009. "From turmoil to crisis: Dislocations in the FX swap market before and after the failure of Lehman Brothers," Journal of International Money and Finance, Elsevier, vol. 28(8), pages 1350-1374, December.
    3. Claudio Borio & Piti Disyatat, 2011. "Global imbalances and the financial crisis: Link or no link?," BIS Working Papers 346, Bank for International Settlements.
    4. Maurice Obstfeld, 2009. "Lenders of Last Resort in a Globalized World," IMES Discussion Paper Series 09-E-18, Institute for Monetary and Economic Studies, Bank of Japan.
    5. Baba, Naohiko & Sakurai, Yuji, 2011. "When and how US dollar shortages evolved into the full crisis? Evidence from the cross-currency swap market," Journal of Banking & Finance, Elsevier, vol. 35(6), pages 1450-1463, June.
    6. Claudia Buch & Catherine Koch & Michael Koetter, 2016. "Crises and rescues: liquidity transmission through international banks," BIS Working Papers 576, Bank for International Settlements.
    7. Cheung, Yin-Wong (ed.), 2012. "The Evolving Role of China in the Global Economy," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262018234, December.
    8. Cerutti, Eugenio M. & Obstfeld, Maurice & Zhou, Haonan, 2021. "Covered interest parity deviations: Macrofinancial determinants," Journal of International Economics, Elsevier, vol. 130(C).
    9. Jinzhao Chen, 2012. "Crisis, Capital Controls and Covered Interest Parity: Evidence from China in Transformation," PSE Working Papers halshs-00660654, HAL.
    10. Robert N McCauley, 2011. "The euro and the yen as anchor currencies before and during the financial crisis - comments on Moss's paper "The euro: internationalised at birth" and Takagi's paper "Internationalising," BIS Papers chapters, in: Bank for International Settlements (ed.), Currency internationalisation: lessons from the global financial crisis and prospects for the future in Asia and the Pacific, volume 61, pages 93-104, Bank for International Settlements.
    11. Rose, Andrew K. & Spiegel, Mark M., 2012. "Dollar illiquidity and central bank swap arrangements during the global financial crisis," Journal of International Economics, Elsevier, vol. 88(2), pages 326-340.
    12. Bertrand Blancheton & Christian Bordes & Samuel Maveyraud & Philippe Rous, 2012. "Risk of liquidity and contagion of the crisis on the US, UK and Euro Zone money markets," Université Paris1 Panthéon-Sorbonne (Post-Print and Working Papers) hal-01098954, HAL.
    13. William Goulding & Daniel E. Nolle, 2012. "Foreign banks in the U.S.: a primer," International Finance Discussion Papers 1064, Board of Governors of the Federal Reserve System (U.S.).
    14. Dagfinn Rime & Andreas Schrimpf & Olav Syrstad, 2017. "Segmented money markets and covered interest parity arbitrage," BIS Working Papers 651, Bank for International Settlements.
    15. Dietrich Domanski & Philip Turner, 2011. "The Great Liquidity Freeze : What Does It Mean for International Banking?," Finance Working Papers 23245, East Asian Bureau of Economic Research.
    16. Dagfinn Rime & Andreas Schrimpf & Olav Syrstad, 2022. "Covered Interest Parity Arbitrage," The Review of Financial Studies, Society for Financial Studies, vol. 35(11), pages 5185-5227.
    17. Chen, Shiu-Sheng & Chou, Yu-Hsi, 2023. "Liquidity yield and exchange rate predictability," Journal of International Money and Finance, Elsevier, vol. 137(C).
    18. Dong He & Robert McCauley, 2010. "Offshore markets for the domestic currency: monetary and financial stability issues," BIS Working Papers 320, Bank for International Settlements.
    19. Gino Cenedese & Pasquale Della Corte & Tianyu Wang, 2021. "Currency Mispricing and Dealer Balance Sheets," Journal of Finance, American Finance Association, vol. 76(6), pages 2763-2803, December.
    20. Anella Munro & Michael Reddell, 2012. "Foreign currency reserves: why we hold them influences how we fund them," Reserve Bank of New Zealand Bulletin, Reserve Bank of New Zealand, vol. 75, pages 35-45, September.

    More about this item

    JEL classification:

    • E58 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Central Banks and Their Policies
    • F34 - International Economics - - International Finance - - - International Lending and Debt Problems
    • G28 - Financial Economics - - Financial Institutions and Services - - - Government Policy and Regulation
    • G29 - Financial Economics - - Financial Institutions and Services - - - Other

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bis:bisqtr:0903g. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Christian Beslmeisl (email available below). General contact details of provider: https://edirc.repec.org/data/bisssch.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.