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Standing Repo Facilities, Then and Now

Author

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  • Charles M. Kahn
  • Stephen F. Quinn
  • William Roberds

Abstract

Recently there have been discussions, both within the FOMC and more broadly, about whether the FOMC should set up a standing repo facility. Such a facility would allow banks to sell safe assets (U.S. Treasury securities) to the Fed, with the assurance of subsequent repurchase, in unlimited quantities at an administered rate. This is not a new idea. In fact, a similar facility was implemented in 1683 by the Bank of Amsterdam, the leading central bank of the time, and operated for more than a century afterward. In this article, we describe the motivations, operations, and limitations of the Bank of Amsterdam's facility and what lessons this historical experience offers for modern-day central banks.

Suggested Citation

  • Charles M. Kahn & Stephen F. Quinn & William Roberds, 2020. "Standing Repo Facilities, Then and Now," Policy Hub, Federal Reserve Bank of Atlanta, vol. 2020(1), pages 1-27, January.
    • Handle: RePEc:fip:a00068:99124
    DOI: 10.29338/ph2020-01
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    References listed on IDEAS

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    4. Stefano Ugolini, 2017. "The Evolution of Central Banking: Theory and History," Palgrave Studies in Economic History, Palgrave Macmillan, number 978-1-137-48525-0, June.
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