Several papers at this conference illustrate the role of collateral and the problems we are confronted with if this instrument is not available. Let me mention as one example the paper by Larry Christiano and his co authors.
This paper points out the fundamental role which collateral plays in an integrated world and concludes that "having collateral or having not" not only makes a big difference for the creditors and debtors but also for monetary policy. However collateral might play different roles in different financial systems. John Moore`s paper is very informative in this respect.