Securitized Banking and the Run on Repo

ArXiv ID: ssrn-1454939 “View on arXiv”

Authors: Unknown

Abstract

The Panic of 2007-2008 was a run on the sale and repurchase market (the “repo” market), which is a very large, short-term market that provides financi

Keywords: Repurchase Agreement (Repo), Liquidity Crisis, Shadow Banking, Financial Stability, Systemic Risk, Fixed Income (Money Markets)

Complexity vs Empirical Score

• Math Complexity: 2.0/10
• Empirical Rigor: 3.0/10
• Quadrant: Philosophers
• Why: The paper is primarily a conceptual and empirical analysis of the 2007-2008 financial crisis, using novel data to trace contagion but lacking advanced mathematical formalism or backtesting frameworks.

  flowchart TD
    A["Research Goal:<br>Explain the 2007-2008 Panic"] --> B["Key Methodology:<br>Analyze Bank Holding Company Data"]
    B --> C["Data Inputs:<br>Repo Transactions & Financial Statements"]
    C --> D["Computational Processes:<br>Run Regressions on Liquidity Creation"]
    D --> E["Key Findings/Outcomes:<br>1. Repo funding runs caused the crisis<br>2. Increased securitization heightened systemic risk"]