Transcripts of the monetary policymaking body of the Federal Reserve from 2002–2008.

I also want to point out that for the banks that don’t have enough collateral today, that doesn’t mean that they don’t have collateral available. It is just that the collateral hasn’t been pledged at the window. So the bottom line is that we don’t think that the overcollateralization requirement is very constraining—to use economics terms, the shadow price of collateral is pretty close to zero as far as we can tell.

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