Category Archives: Rehypothecation

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Covering the Repo Market and Shadow Banking

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From the Donald W. Reynolds National Center for Business Journalism at Arizona State University: Mary Fricker, founder of RepoWatch.org, said the repurchase market is a key reason for the ferocity of the financial crisis. She shares her tips and resources … Continue reading

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The future looks a lot like the past

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“Regulation of shadow banking is starting to look more and more like regulation of traditional banking 100 to 150 years ago, when it took decades of runs on banks, bank failures and economic agony before  Congress in 1933 finally approved … Continue reading

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Economists and other analysts see value, danger in repo and shadow banking, urge reform

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Latest update: October 2, 2012 In recent months economists and other experts have published a torrent of reports on repo and shadow banking, noting their importance and their dangers and urging reform. Following are 74 of the reports, arranged chronologically … Continue reading

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An overview of shadow banking for journalists

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This post is a transcript of  a 12-minute talk RepoWatch editor Mary Fricker gave at the annual conference of Investigative Reporters & Editors in Boston June 15, 2012. Click here for accompanying handout and slides. Shadow banking was the epicenter of the financial … Continue reading

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Matt King had it right in 2008, joins Gorton, Milne

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Commentary The Financial crisis of 2008 was not caused by financial institutions having to write down the value of subprime loans, collateralized debt obligations of asset-backed securities, asset-backed commercial paper, auction rate securities, and just plain old home loans. Instead, … Continue reading

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The media buzz about rehypothecation

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Updated July 30, 2013 Rehypothecation may be the news hook that finally gets the U.S. business press to start covering the repurchase market. Ever since the broker-dealer MF Global filed bankruptcy October 31, and word escaped that $1.2 billion of … Continue reading

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Bloomberg details Fed’s three-year bailout frenzy

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Bloomberg News has given us a stunning picture of the frantic efforts by the Federal Reserve to save the credit markets between August 2007 and April 2010. The report doesn’t mention the R-word (repo), even though fear for the repurchase … Continue reading

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Economists: Finance needs to be measured in new ways

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A new paper by three economists shows how far finance has come from the days when banks took in deposits and used the money to make loans. Today that same bank might augment those deposits by borrowing on the repo market … Continue reading

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NYFed adds more money market funds as repo partners

The Federal Reserve Bank of New York today released the names of 32 more money market funds that have been approved to buy securities from the New York Fed, if and when the Federal Open Market Committee decides to start … Continue reading

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Accounting Onion faults FCIC report

Accounting Onion, Tom Selling’s blog, today criticizes the Financial Crisis Inquiry Commission report for failing to hold the accounting profession accountable for its role in the crisis. We are left to conclude that either: (a) the commission couldn’t bring itself … Continue reading

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Proposal: Limit securitized banking to special banks

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Securitized banking is worth saving, and that can best be done by creating special banks to buy the securities, say Yale professors Gary Gorton and Andrew Metrick, early proponents of the view that the financial crisis of 2007-2008 was a … Continue reading

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Re-use of collateral is major tool for leveraged finance

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Rehypothecation helps explain rapid bank growth in the years leading up to the financial crsis of 2007-2008 and even faster bank deflation since, according to a July 2010 study by International Monetary Fund senior economist Manmohan Singh. Specifics are hard … Continue reading