It's no accident that brokers in trouble go begging to commercial banks for assistance.
Traditionally, discount-window loans were provided to commercial banks that were having trouble obtaining financing in the open market.
The capped rates the central bank can offer on its bills are not very attractive to commercial banks, which often fail to bid for them.
The financial markets were boosted by a surprise decision by the US central bank to cut the interest rate at which it lends money to commercial banks.
The seventh rise in a year took the rate at which the central bank loans to commercial banks from 6.25% to 6.5%, the highest since early 2008.
The business will become even more attractive to commercial banks next year when new capital standards mean banks can set aside less capital against margin loans to hedge funds.
Andrew Crockett, a former head of the Bank for International Settlements, thinks central banks should broaden the range of collateral they accept when they supply cash to commercial banks.
That's the loans they'll make directly to banks, but not just to commercial banks as usual but also to securities dealers, which is something they haven't done since the Great Depression.
Much as the chaebol bosses gripe that appointing outside directors is costly and risks transferring corporate secrets, their pleas are likely to fall on deaf ears, not least because the same rule already applies to commercial banks.
New capital requirements that take effect next year will make the business more attractive to commercial banks, which right now have a disadvantage to the brokers because they have to set aside more capital against margin loans to hedge funds.
By ditching its longstanding rule about lending only to commercial banks and extending this facility to investment banks, the Fed is in effect admitting that it faces a different sort of financial system one in which dealers pose as much of a threat to stability as lenders.
Mr. Mathur, SIAM's director general, said the authorities need to do a "lot more" to encourage commercial banks to cut interest rates to help revive car sales.
The move was expected to prompt commercial banks to trim their prime lending rate, which would reduce the benchmark rate for millions of consumer and business loans to 7.25 percent.
Permitting this arrangement to continue, in effect, subordinates Western taxpayers to private commercial banks when it comes to repayments on outstanding debt.
Glass Steagall was passed to prevent commercial banks taking government insured deposits from failing due to losses incurred through riskier investment banking activities (issuing stock and other securities).
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And the ECB is also lending more and more euros to commercial eurozone banks.
The answer is to restructure commercial banks so they no longer make loans.
The Fed offered to expand its emergency lending program to help commercial banks finance the purchase of asset-backed securities from the funds.
But there is no reason to think that the government is prepared to close commercial banks, no matter how ill they may be.
The institutions were an idealistic, independent alternative to the commercial banks.
Because SMEs were effectively locked out of both the public equity and bond markets, most turned to the commercial banks, which were, by far, the largest providers of capital during that period.
First, it provided funds to the commercial banks.
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Without enough cash or cachet to get involved with the national banks, China's private entrepreneurs have been turning to smaller city commercial banks.
In other cases, the involvement was indirect and open-ended: in South Korea, for instance, the government leaned and continues to lean on commercial banks to finance the move into chip making by the country's family-controlled conglomerates.
It would appear that this would amount to yet another loophole that could be used to allow U.S. commercial banks to provide general purpose lending to the Soviet Union bypassing the current prohibitions of the Johnson-Debt Default Act.
It would appear that this would amount to yet another loophole that could be used to allow U.S. commercial banks to provide general purpose lending to the Soviet Union -- bypassing the current prohibitions of the Johnson-Debt Default Act.
Of the 100bn euros that will be provided to banks by commercial investors, national governments and the EU's bailout fund, most is expected to go to banks in Greece, Italy, Spain, Portugal, France and Germany - because they have the biggest exposure to the most indebted governments.
The second was to use its balance sheet to help commercial and investment banks finance their holdings of hard-to-value securities and avoid fire-sales of assets.
Mr Frank wants Wall Street to be subjected to capital requirements similar to those for stodgier commercial banks (which are lobbying vociferously for the gap to be closed).
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