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Market Liquidity after the Financial Crisis

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Abstract

The possible adverse effects of regulation on market liquidity in the post-crisis period continue to garner significant attention. In a recent paper, we update and unify much of our earlier work on the subject, following up on three series of earlier Liberty Street Economics posts in August 2015, October 2015, and February 2016. We find that dealer balance sheets have continued to stagnate and that various measures point to less abundant funding liquidity. Nonetheless, we do not find clear evidence of a widespread deterioration in market liquidity.

Suggested Citation

  • Tobias Adrian & Michael J. Fleming & Or Shachar, 2017. "Market Liquidity after the Financial Crisis," Liberty Street Economics 20170628, Federal Reserve Bank of New York.
  • Handle: RePEc:fip:fednls:87200
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    1. Markus K. Brunnermeier & Lasse Heje Pedersen, 2009. "Market Liquidity and Funding Liquidity," Review of Financial Studies, Society for Financial Studies, vol. 22(6), pages 2201-2238, June.
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    14. Tobias Adrian & Michael J. Fleming & Erik Vogt & Zachary Wojtowicz, 2016. "Corporate Bond Market Liquidity Redux: More Price-Based Evidence," Liberty Street Economics 20160209, Federal Reserve Bank of New York.
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    More about this item

    Keywords

    dealers; market liquidity; crisis;
    All these keywords.

    JEL classification:

    • G1 - Financial Economics - - General Financial Markets

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