by Summary:
On his blog, Urs Birchler offers different perspectives on the question whether the Swiss National Bank (SNB) is obliged to pay out banks’ reserves in cash. One view: Reserves are legal tender. The SNB therefore is not obliged to exchange reserves against cash. Another view: According to the law, the SNB is required to provide sufficient cash. Moreover, reserves and cash were meant to be perfect substitutes. Yet another view: Lawmakers would have written a different law had they known that the SNB considers it necessary to impose negative interest rates.
Topics:
Dirk Niepelt considers the following as important: Cash, Interest Rate, Notes, Reserves, Swiss National Bank, Zero lower bound
This could be interesting, too:
On his blog, Urs Birchler offers different perspectives on the question whether the Swiss National Bank (SNB) is obliged to pay out banks’ reserves in cash. One view: Reserves are legal tender. The SNB therefore is not obliged to exchange reserves against cash. Another view: According to the law, the SNB is required to provide sufficient cash. Moreover, reserves and cash were meant to be perfect substitutes. Yet another view: Lawmakers would have written a different law had they known that the SNB considers it necessary to impose negative interest rates.
Topics:
Dirk Niepelt considers the following as important: Cash, Interest Rate, Notes, Reserves, Swiss National Bank, Zero lower bound
This could be interesting, too:
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On his blog, Urs Birchler offers different perspectives on the question whether the Swiss National Bank (SNB) is obliged to pay out banks’ reserves in cash.
- One view: Reserves are legal tender. The SNB therefore is not obliged to exchange reserves against cash.
- Another view: According to the law, the SNB is required to provide sufficient cash. Moreover, reserves and cash were meant to be perfect substitutes.
- Yet another view: Lawmakers would have written a different law had they known that the SNB considers it necessary to impose negative interest rates.