TY - JOUR
T1 - Temporary open market operation on MBS repos
T2 - Any foreshadowing of the financial crisis of 2008?
AU - Akay, Ozgur (Ozzy)
AU - Winters, Drew B.
PY - 2011/7
Y1 - 2011/7
N2 - The financial crisis of 2008 was significantly influenced by housing, mortgage markets and mortgage-backed securities (MBS). The Federal Reserve (Fed) conducts temporary open market operations on a daily basis and frequently uses repos on MBS. With this daily interaction with MBS, we examine whether any signal about the impending financial crisis could have been seen in the Fed's temporary open market operations. We identify four anomalous events in MBS temporary open market operations and examine those events for signals of the financial crisis. We find nothing in the four events that would have provided signals of the financial crisis. Instead, the common feature of the four events is an unusually large supply of MBS made available to the Fed for those day's temporary open market operations.
AB - The financial crisis of 2008 was significantly influenced by housing, mortgage markets and mortgage-backed securities (MBS). The Federal Reserve (Fed) conducts temporary open market operations on a daily basis and frequently uses repos on MBS. With this daily interaction with MBS, we examine whether any signal about the impending financial crisis could have been seen in the Fed's temporary open market operations. We identify four anomalous events in MBS temporary open market operations and examine those events for signals of the financial crisis. We find nothing in the four events that would have provided signals of the financial crisis. Instead, the common feature of the four events is an unusually large supply of MBS made available to the Fed for those day's temporary open market operations.
KW - Financial Crisis of 2007-08
KW - MBS Repos
KW - Open Market Operations
UR - http://www.scopus.com/inward/record.url?scp=79959709538&partnerID=8YFLogxK
U2 - 10.1007/s12197-009-9110-6
DO - 10.1007/s12197-009-9110-6
M3 - Review article
AN - SCOPUS:79959709538
SN - 1055-0925
VL - 35
SP - 260
EP - 273
JO - Journal of Economics and Finance
JF - Journal of Economics and Finance
IS - 3
ER -