The innovation of wholesale funding

Topic: Wholesale funding, bank runs and liquidity freezes in the 2007/8 financial crisis

 

The canonical model of banking crises by Diamond and Dybvik focuses on depositor runs which prompt a liquidity crisis.

 

Such runs were largely absent in the 2007- 8 crisis but liquidity freezes played a central role.
Discuss the innovation of wholesale funding.
Discuss how traditional bank runs and compare it to the one that was witnessed during the 2008 banking crisis.

find the cost of your paper