Fed’s Stein highlights transatlantic risks
Differences in funding arrangements on opposite sides of the Atlantic may lead to strains in banks' dollar funding operations, but this can be corrected for, according to Jeremy Stein, a member of the Federal Reserve Board of Governors.
Addressing a finance and macroeconomics forum in Frankfurt on December 17, Stein presented research co-written with Victoria Ivashina and David Scharfstein. They examined a situation where a European bank financed its euro lending using insured deposits, but
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