Shadow money and the public money supply: the impact of the 2007-2009 financial crisis on the monetary system

This article explores the effects of the political reactions to the 2007–2009 financial crisis on the monetary system. It chimes in with the view that shadow banks create ‘shadow money’, i.e. private substitutes for bank deposits. The article analyses how the three main forms of shadow money – money market fund shares, overnight repurchase agreements and asset-backed commercial papers – were affected by the short-term government intervention and medium-term regulation during and after the 2007–2009 financial crisis in the United States. The analysis reveals that the measures taken between 2007 and 2014 integrated some shadow money forms in the public money supply. In the year after the Lehman collapse, the initially private shadow money supply was either publicly backstopped or de-monetised as it had broken par to bank deposits. The public backstops took on the form of emergency facilities established by the Federal Reserve and guarantees proclaimed by the Treasury. Those backstops imply that the public institutional framework to protect bank deposits was extended to some forms of shadow money during the crisis. This tendency has continued in post-crisis regulation. Accordingly, the 2007–2009 financial crisis has triggered a paradigmatic change in the monetary system, attributable to the political decisions of US authorities

Between Two Fires: Mayangna Indians in Post-Revolutionary Nicaragua, 1979-1990

The predominant Mayangna narrative of the Nicaraguan Civil Warholds that the Miskitu tricked them into joining the conflict. However, Iargue here that the Mayangna leadership and the Sandinista governmentwere also responsible, as Sandinista denial of the importance of ethnicdifference in Nicaragua allowed Miskitu nationalists, using the languageof religion, to co-opt Mayangna leaders, while subsequent Sandinistaviolence turned Mayangna civilians against the revolution. Accusationsof trickery stem from later Mayangna disillusion with the war and fromproblems with the autonomous political system set up in its wake, whichencourages the Mayangna to underplay the role of their own leaders andthe Sandinista government in embroiling them in the conflict. This one-sided narrative, however, increasingly defines Mayangna interpretationsof their very identity as a people