It also runs a stock borrowing program for member firms that are engaging in short-selling or other market-making activities where borrowing securities becomes necessary.
The SEC will be hosting a roundtable discussion on Sept. 30 to discuss securities lending, pre-borrowing and possible additional short sale disclosures.
Some of the investors who had to cash out found they could best do so by borrowing against the securities at a margin rate of 7 percent or more.
Countries also are divided over the treatment of repurchase agreements, a form of short-term borrowing for dealers in government securities.
Indeed, given the current dearth of creditworthy sovereign borrowers elsewhere in the world, due to the ravages of the international debt crisis, Western bankers and securities firms continue to offer Moscow more borrowing opportunities than the USSR needs.
CENTERFORSECURITYPOLICY: US Trade Relations with The USSR and Eastern Europe
The rush to sell BABs before the deadline is also driving up yields on those securities, adding to state and local government borrowing costs.
Hence the interest in funds that typically aim to make money regardless of the direction of markets, often by borrowing money to place leveraged bets and by selling securities they do not own in anticipation of price falls.
Instead of borrowing from banks, those in need of funds could issue securities.
The package allows Norwegian banks to swap toxic debt products like mortgage-backed securities for new government bonds, which can then be used as collateral for borrowing from the central bank.
Italy's borrowing costs leapt to a four-month high at a sale of short-dated government securities on Tuesday.
Mortgage REITs, which use short-term debt to buy longer-term mortgage securities, also are at the greatest risk if interest rates rise because that would increase their short-term borrowing costs and cut the value of the mortgage bonds that they hold, possibly resulting in losses and reduced dividends.
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