The Federal Reserve's Financial Crisis Response D: Commercial Paper Market Facilities

2016 ◽  
Author(s):  
Rosalind Z. Wiggins ◽  
Andrew Metrick





2020 ◽  
pp. 529-564
Author(s):  
J. NELLIE LIANG ◽  
MARGARET M. McCONNELL ◽  
PHILLIP SWAGEL


2010 ◽  
Vol 24 (1) ◽  
pp. 29-50 ◽  
Author(s):  
Marcin Kacperczyk ◽  
Philipp Schnabl

Commercial paper is a short-term debt instrument issued by large corporations. The commercial paper market has long been viewed as a bastion of high liquidity and low risk. But twice during the financial crisis of 2007–2009, the commercial paper market nearly dried up and ceased being perceived as a safe haven. Major interventions by the Federal Reserve, including large outright purchases of commercial paper, were eventually used to support both issuers of and investors in commercial paper. We will offer an analysis of the commercial paper market during the financial crisis. First, we describe the institutional background of the commercial paper market. Second, we analyze the supply and demand sides of the market. Third, we examine the most important developments during the crisis of 2007–2009. Last, we discuss three explanations of the decline in the commercial paper market: substitution to alternative sources of financing by commercial paper issuers, adverse selection, and institutional constraints among money market funds.





2013 ◽  
Vol 68 (3) ◽  
pp. 815-848 ◽  
Author(s):  
DANIEL COVITZ ◽  
NELLIE LIANG ◽  
GUSTAVO A. SUAREZ


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