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A Flow-of-Funds Perspective on the Financial CrisisGlobal Liquidity and Credit Booms

A Flow-of-Funds Perspective on the Financial Crisis: Global Liquidity and Credit Booms [This chapter explores selected aspects of the measurement of global liquidity.1 We focus on the international dimension of credit that cannot he fully captured by the monetary and balance-of-payments statistics typically used to proxy liquidity. We define the international dimension of credit to comprise two different but related components: foreign currency credit to residents, regardless of the lender’s loca- tion; and cross-border (external) credit, regardless of the currency of denomination.2 We measure these components by combining interna- tional financial statistics of the Bank for International Settlements (BIS) and national sources (see Box 5.1) and we identify regularities in their behaviour, both in the aggregate and in individual countries. Some findings stand out.] http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png

A Flow-of-Funds Perspective on the Financial CrisisGlobal Liquidity and Credit Booms

Part of the Palgrave Studies in Econmics and Banking Book Series
Editors: Winkler, Bernhard; Riet, Ad van; Bull, Peter
Borio, Claudio; McCauley, Robert N.; McGuire, Patrick
A Flow-of-Funds Perspective on the Financial Crisis — Dec 4, 2015
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Publisher
Palgrave Macmillan UK
Copyright
© Palgrave Macmillan, a division of Macmillan Publishers Limited 2014
ISBN
978-1-349-46944-4
Pages
94 –124
DOI
10.1057/9781137352989_5
Publisher site
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Abstract

[This chapter explores selected aspects of the measurement of global liquidity.1 We focus on the international dimension of credit that cannot he fully captured by the monetary and balance-of-payments statistics typically used to proxy liquidity. We define the international dimension of credit to comprise two different but related components: foreign currency credit to residents, regardless of the lender’s loca- tion; and cross-border (external) credit, regardless of the currency of denomination.2 We measure these components by combining interna- tional financial statistics of the Bank for International Settlements (BIS) and national sources (see Box 5.1) and we identify regularities in their behaviour, both in the aggregate and in individual countries. Some findings stand out.]

Published: Dec 4, 2015

Keywords: Monetary Policy; Euro Area; Foreign Currency; Credit Growth; Total Credit

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