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S financial sector quarterly in billions of dollars

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Unformatted text preview: ces of Funding to the Net Increase in the Liabilities of the U.S. Financial Sector (quarterly, in billions of dollars) 2,000 1,500 $ billions 1,000 500 0 –500 Checkable deposits Money market mutual fund shares Fed funds and repos Commercial paper –1,000 –1,500 4 Q 1 Q 9- 0 20 9- 0 20 2 Q 3 Q 8- 0 20 4 Q 7- 0 20 1 Q 6- 0 20 2 Q 6- 0 20 5- 0 20 3 Q 4 Q 4- 0 20 3- 0 20 1 Q 3- 0 20 Source: Federal Reserve Board, Flow of Funds Accounts. 25 26 Journal of Economic Perspectives resulted resulted more from obstacles to credit supply, resulting from developments in the financial sector itself, than from a reduction in credit demand owing to the probnancial lems of ultimate borrowers. Hence, Hence, what is needed is a framework for macroeconomic analysis in which intermediation plays a crucial role and in which frictions that can impede an efficient supply of credit are allowed for, a framework which also takes account of the fact that the U.S. financial sector is now largely market-based. Fortunately, the development of a new generation of macroeconomic models with th...
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This note was uploaded on 11/23/2013 for the course ECON 11837649 taught by Professor Batchelder during the Spring '10 term at Pepperdine.

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