MARC Record from Scriblio

LEADER: 02227cam 22002657a 4500
001 2004620109
003 DLC
005 20041007102222.0
007 cr |||||||||||
008 040930s2004 ilu sb f000 0 eng
010 $a 2004620109
040 $aDLC$cDLC
050 00 $aHG2401
100 1 $aFurfine, Craig.
245 10 $aStanding facilities and interbank borrowing$h[electronic resource] :$bevidence from the Federal Reserve's new discount window /$cCraig Furfine.
260 $a[Chicago, Ill.] :$bFederal Reserve Bank of Chicago,$c[2004]
490 1 $aWorking paper series ;$vWP-2004-01
538 $aSystem requirements: Adobe Acrobat Reader.
538 $aMode of access: World Wide Web.
500 $aTitle from PDF file as viewed on 9/30/2004.
530 $aAlso available in print.
504 $aIncludes bibliographical references.
520 3 $a"Standing facilities are designed to place an upper bound on the rates at which financial institutions lend to one another overnight, reducing the volatility of the overnight interest rate, typically the rate targeted by central banks. However, improper design of the facility might decrease a bank's incentive to participate actively in the interbank market. Thus, the mere availability of central bank provided credit may lead to its use being more than what would be expected based on the characteristics of the interbank market. By contrast, however, banks may perceive a stigma from using such facilities, and thus borrow less than what one might expect, thereby reducing the facilities' effectiveness at reducing interest rate volatility. We develop a model demonstrating these two alternative implications of a standing facility. Empirical predictions of the model are then tested using data from the Federal Reserve's new primary credit facility and the US federal funds market. A comparison of data from before and after recent changes to the discount window suggests continued reluctance to borrow from the Fed"--Federal Reserve Bank of Chicago web site.
830 0 $aWorking paper series (Federal Reserve Bank of Chicago. Research Dept. : Online) ;$vWP-2004-01.
856 40 $uhttp://www.chicagofed.org/economic_research_and_data/wp_abstract.cfm?pubsID=605