The transmission of liquidity shocks during the crisis

The rapid transmission of the subprime mortgage crisis in the United States to other domestic and foreign financial markets raises several questions of great importance to central banks and financial regulators. Through which mechanisms were the liquidity shocks transmitted across financial markets during this period? Why did the episode of funding illiquidity in structured investment vehicles (SIVs) and conduits turn into an issue of bank insolvency? Conceptually, a number of new transmissio