Document Type

Article

Publication Date

2012

Abstract

The money markets are at the heart of the recent financial crisis and are the subject of substantial news coverage. However, much of what was reported showed a lack of understanding of money markets in general and, a specific lack of understanding as to why the financial crisis unfolded as it did in these markets. The purpose of this paper is to discuss what actually happened and why. Specifically, we discuss: (1) the economic role of the money markets, (2) the institutional features of the money markets central to the financial crisis and, (3) what actually happened in the various money markets.

Comments

This article was originally published in Journal of Applied Finance 22, no. 2 (2012): 39-59.

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