This article continues my sequence of articles on central banks as banks, which is projected to be a chapter in my banking manuscript. This article is relatively lightweight, but I wanted to break this issue out of another planned article. What assets central banks should have on their balance sheet is controversial for some people, but for the post-World War II to 2008 Financial Crisis period, developed countries without currency pegs just held government bonds without raising questions from the bulk of economists. The Financial Crisis forced central banks to buy private sector assets, which re-opened this debate. This article looks at one type of private sector assets to be held — uncollateralised loans to the private sector.
can assume that a certain amount of its liabilities are “sticky” and so it does need 100% of assets to be short duration.-->should be-->doesn't [need 100%]
Admire your write up and just ordered Understanding Government Finance. Thank you sir!
Typo? Or I think so:
can assume that a certain amount of its liabilities are “sticky” and so it does need 100% of assets to be short duration.-->should be-->doesn't [need 100%]