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Development Of The Payment Systems: An Economic Need Or A Technological Deed, Heba Mekawy
Development Of The Payment Systems: An Economic Need Or A Technological Deed, Heba Mekawy
Future Journal of Social Science
This paper is mainly concerned with showing most of the economic aspects related to both banking transactions, payments, and eventually the payment systems and their development. The economic aspects are discussed on both the macroeconomic and the microeconomic one as well. The discussion in the paper also covers the economic implications of the payment systems and the economic rationale behind their development. The paper has concluded that the economic need of the financial market is the main driver behind the development of payment systems. They also serve as outcomes concerning the well-functioning of the financial market. Thus, the technological development …
Check Is In The Mail: Correspondent Clearing And The Banking Panics Of The Great Depression, Gary Richardson
Check Is In The Mail: Correspondent Clearing And The Banking Panics Of The Great Depression, Gary Richardson
Gary Richardson
Weaknesses within the check-clearing system played a hitherto unrecognized role in the banking crises of the Great Depression. Correspondent check-clearing networks were vulnerable to counter-party cascades. Accounting conventions that overstated reserves available to corresponding institutions may have exacerbated the situation. The initial banking panic began when a correspondent network centered in Nashville collapsed, forcing over 100 institutions to suspend operations. As the contraction continued, additional correspondent systems imploded. The vulnerability of correspondent networks is one reason that banks that cleared via correspondents failed at higher rates than other institutions during the Great Depression.