Broad-Based Emergency Liquidity

New York Clearing House Association: The Crisis of 1914

Purpose

To provide temporary liquidity to member banks of the NYCH and lessen their need to liquidate assets to settle clearing balances

Key Terms

  • Launch Dates
    Announcement and issuance: August 3, 1914
  • Expiration Date
    Final issuance: October 15, 1914; Final cancellation: November 28, 1914
  • Legal Authority
    Not applicable
  • Peak Outstanding
    $109 million on September 25, 1914
  • Participants
    Members of the NYCH, including trust companies
  • Rate
    6% on circulating CLCs
  • Collateral
    Commercial paper, bonds and other securities, and collateral loans
  • Loan Duration
    Not applicable
  • Notable Features
    Paired with Aldrich-Vreeland emergency currency
  • Outcomes
    Panic subsided, and the Federal Reserve System began operating shortly thereafter

Key Design Decisions

Purpose1

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Individual Participation Limits1

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Eligible Collateral or Assets1

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Impact on Monetary Policy Transmission1

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Similar Programs in Other Countries1

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Key Program Documents

Key Program Documents

Key Program Documents

Taxonomy

Intervention Categories:

  • Broad-Based Emergency Liquidity

Countries and Regions:

  • United States

Crises:

  • National Banking Era Crises (1863-1913)