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Collateral and shadow money


FT Alphaville has a great post about the money-like properties of collateral in the shadow banking system.  It summarizes a note from Credit Suisse that tries to quantify how the repo market impacts the money supply.  Both are majestic, especially the Alphaville post for how clearly it places collateral in the monetary policy framework.  Diagrams like this make the subject accessible even to non-economists: