Main Content

Bank Liquidity

  • How Do We Figure Out Optimal Liquidity Regulation?

    Douglas Diamond, and Anil K Kashyap

    Banks have some self-interest to avoid runs. But opaque and imperfect asset information makes it tricky to reassure all depositors. Must regulations demand some unused liquidity? This framework can help future discussions find the optimal level and form of liquidity requirements.

  • Determining the Quantity of Bank Deposits

    Charles Goodhart

    The determination of the money supply has traditionally been the monetary base/money multiplier theory. In reality, this view was incorrect, which the Great Financial Crisis of 2009 made clear.

  • Banking Regulation: Toward a New Paradigm

    H Rodgin Cohen

    A revision of the current regulatory paradigm is needed to encourage collaboration between the public and private sectors, rather than separation.