IDEAS home Printed from https://ideas.repec.org/a/fip/fedpbr/y2010iq1p1-10.html
   My bibliography  Save this article

Let's make it clear: how central counterparties save(d) the day

Author

Listed:
  • Cyril Monnet

Abstract

The bankruptcy of Lehman Brothers in 2008 will certainly be featured in history books as one of the greatest financial failures so far, but it will also be recorded as yet another episode of the historically successful performance of clearing arrangements in ensuring the resiliency of markets. Recognizing the usefulness of safe and sound clearing and settlement procedures, the Federal Reserve has recently supported the attempt to shift the clearing of some contracts to a central counterparty. In this article, Cyril Monnet outlines the arguments in favor of central counterparty clearing, the economic rationale for trade clearing through a central counterparty, and some possible limits to the advantages of clearing trades through a central counterparty.

Suggested Citation

  • Cyril Monnet, 2010. "Let's make it clear: how central counterparties save(d) the day," Business Review, Federal Reserve Bank of Philadelphia, issue Q1, pages 1-10.
  • Handle: RePEc:fip:fedpbr:y:2010:i:q1:p:1-10
    as

    Download full text from publisher

    File URL: http://www.philadelphiafed.org/research-and-data/publications/business-review/2010/q1/brq110_central-counterparties.pdf
    Download Restriction: no

    References listed on IDEAS

    as
    1. James T. Moser, 1998. "Contracting innovations and the evolution of clearing and settlement methods at futures exchanges," Working Paper Series WP-98-26, Federal Reserve Bank of Chicago.
    Full references (including those not matched with items on IDEAS)

    More about this item

    Keywords

    Bankruptcy ; Risk;

    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:fip:fedpbr:y:2010:i:q1:p:1-10. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Beth Paul). General contact details of provider: http://edirc.repec.org/data/frbphus.html .

    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 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.

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

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.