The Tender For Law

Volume 9

Mar 21, 2015 8:02 PM

Ceit Butler

Wow, did that connect a lot of dots. I started reading up on the Bank for International Settlements. The "About" page is full of fun words to look up! "Prime Counterparty" led me to this:

http://en.wikipedia.org/wiki/Prime_brokerage

...which led me to this:

http://en.wikipedia.org/wiki/Hypothecation

...and specifically, this section:

http://en.wikipedia.org/wiki/Hypothecation#Rehypothecation

Which describes the exact method by which banks borrow overnight from The Bank of Canada.