The Economist warns that Central bank liquidity policy needs refining and harmonising. The ECB’s broad acceptance of collateral like Asset backed securities (ABS) for liquidity is being thoroughly exploited by the banks
around 16% of the ECB’s collateral so far is ABS… unless the ECB changes its tune, it could well end up as the [...]
Archive for June 16th, 2008
Problems in Central Bank Lending
Posted in Business on June 16, 2008 | Leave a Comment »
Prime Brokerage Landscape after Bear Stearns
Posted in Business, Markets on June 16, 2008 | Leave a Comment »
Economist has a nice article on the Prime Brokerage landscape after Bear Stearns.
The hedge funds hold a lot of OTC derivatives written by the Prime Brokers and their assets are parked at the PB who can lend it out. Given that the industry is so concentrated around a few PB’s (image); even if the [...]
