Geldmarkt und Geldmarktkonzepte

Abstract

The article sets out to ventilate from the standpoint of scientific bank management theory the controversial delimitation of the “money market” in the literature and in practice with special reference to institutional conditions in the Federal Republic of Germany. [The article first appeared in 1976 in the tribute to Prof. Dr. Dr. h.c. Wilhelm Hasenack, Göttingen, for his 75th birthday (Unternehmen und Gesellschaft {The Firm and Society}, nwb-Verlag Herne/Berlin 1976, pp. 163 - 187)]. The author classifies the money market concepts presented in the literature into three versions: 1. Narrow formulation (purpose of money market transactions: “Offsetting of temporary liquidity differences among banks by redistribution of available holdings of central bank money”); 2. Intermediate formulation (in addition to the narrow formulation of the money market under 1, the money market further includes: “Reduction or increase in central bank money holdings of banks by the acquisition or disposal of money market paper from or to the central bank by the banks”); 3. Broad formulation (“granting of short-term loans of all types”). The author presents arguments justifying the intermediate formulation of money market conceps and arrives at the conclusion: with a few limitations, the essential character of the money market in the Federal Republic of Germany is presented accurately by describing it as the “market for free liquidity reserves less unutilized rediscount quotas and the available latitude for collateral loans against securities”.