Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/70648
Authors: 
Tallman, Ellis W.
Moen, Jon R.
Year of Publication: 
2007
Series/Report no.: 
Working Paper, Federal Reserve Bank of Atlanta 2006-23b
Abstract: 
We employ a new data set comprised of disaggregate figures on clearinghouse loan certificate issues in New York City to document how the dominant national banks were crucial providers of temporary liquidity during the Panic of 1907. Clearinghouse loan certificates were essentially bridge loans arranged between clearinghouse members that enabled and were issued in anticipation of monetary gold imports, which took a few weeks to arrive. The large New York City national banks acted as private liquidity providers by requesting (and the New York clearinghouse issuing) a volume of clearinghouse loan certificates beyond their own immediate liquidity needs. While loan certificates were a temporary solution at best to the liquidity crisis in 1907, their issuance allowed the New York banks to serve their role as central reserve city banks in the national banking system.
Subjects: 
clearinghouse
financial crisis
panic
lender of last resort
JEL: 
N11
N21
E42
D71
Document Type: 
Working Paper

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