March 2021

The Fed’s Sever value Window in “Traditional” Times

Huberto M. Ennis and Elizabeth Klee

Summary:

We query unique transaction-stage knowledge of good deal window borrowing sms lån på minuttetin the U.S. between 2010 and 2017, merged sms lån på minuttet quarterly knowledge on bank financial con- ditions (balance sheet and income). The target is to augment our below- standing of the reasons for why banks spend the slash stamp window sms lån på minuttetin the route of sessions outdoor financial crises. We also provide a mannequin of the choice of banks to borrow at the window, which is priceless for interpreting the information. We discover that decisions to make access and to borrow at the slash stamp window are which technique- completely correlated sms lån på minuttet some connected banks’ traits and the composition of banks’ balance sheets. Banks rob simultaneously to produce access to the slash stamp window and win extra cash-cherish liquidity as a percentage of sources. But, conditional on access, bigger and never more liquid banks have a tendency to borrow more from the slash stamp window. On the complete, our findings imply that banks could well, in precept, adapt their operations to modulate, and perchance decrease, their spend of the slash stamp window in “strange” instances.

DOI: https://doi.org/10.17016/FEDS.2021.016

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March 19, 2021

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