Bìznes Inform (May 2018)
The Process of Deployment of Banking System’s Liquidity Crisis in Cyclical Conditions
Abstract
The article is aimed at identifying indicators of the identification and the process of liquidity crisis deployment, determining ways to prevent crisis phenomena of liquidity in conditions of cyclical market development. The scientific approaches to definition of essence of the concept of «liquidity of commercial bank» and the related concepts are generalized, the hierarchical levels of liquidity of the economy are delineated, and the authors’ own interpretation of the concept of «liquidity of banking system in whole» as a qualitatively new level of economic relations is formulated. The concept and types of «structural position» of liquidity of banking system are formed in accordance with the structure of assets and liabilities, its autonomous factors are allocated. A new approach to consideration of the process of liquidity crisis deployment is proposed, in particular on the basis of «liquidity spirals». Attention is focused on the difference between «liquidity spirals» and credit cycle. The authors’ own understanding of «black holes of liquidity» as the most complex manifestation of liquidity crisis has been formed. The reasons, forms of their manifestation and possible consequences are determined. Panic behavior and loss of confidence are allocated among the main reasons for the appearance of «black holes of liquidity». It is proved that the central bank should apply certain regulatory measures in order to eliminate and prevent liquidity crisis.
