I'm having some trouble with an assignment containing an economics issue and was hoping you could help.
The problem:
I'm working on a shadow banking assignment, specifically related to the issue of margin/haircuts in collateralised finance transactions (derivatives, repos, securities lending). I need to write a section on "the economics of the debt markets" that specifically relates to the aforementioned.
What I think:
I think this relates to various things:
1. The supply and demand for shadow banking services as it undercuts traditional banking
2. Collateral Intermediation i.e. collateral velocity, (re-use/re-hypothecation of collateral).
3. Economic functions: Hedging, financing, price discovery and liquidity
The Economics of the Debt Markets
in Economics
Posted
Hi everyone,
I'm having some trouble with an assignment containing an economics issue and was hoping you could help.
The problem:
I'm working on a shadow banking assignment, specifically related to the issue of margin/haircuts in collateralised finance transactions (derivatives, repos, securities lending). I need to write a section on "the economics of the debt markets" that specifically relates to the aforementioned.
What I think:
I think this relates to various things:
1. The supply and demand for shadow banking services as it undercuts traditional banking
2. Collateral Intermediation i.e. collateral velocity, (re-use/re-hypothecation of collateral).
3. Economic functions: Hedging, financing, price discovery and liquidity
Any help would be greatly appreciated.
Thanks in advance.
Mr Kipling