Eurodollar University cover image

Reading Perry Mehrling: Where’s My Swap Line? [Ep. 151, Macropiece Theater]

Eurodollar University

00:00

Market Liquidity for the Global South

The Fed's standing central bank swap facilities are priced at 50 basis points away from covered interest rate parity. This is dealer of last resort in the foreign exchange swap market for those nations fortunate enough to have a swap line. In practice, during a crisis, spreads easily blew through this limit because the facility was open to central banks, not FX dealers themselves. Most important in the recent crisis were the issues of the Global South which comprise the lion's share of global credit growth since the GFC.

Play episode from 30:03
Transcript

The AI-powered Podcast Player

Save insights by tapping your headphones, chat with episodes, discover the best highlights - and more!
App store bannerPlay store banner
 Get the app