As a result, the economic conditions deteriorated simultaneously and sharply worldwide, the situation no policy authorities around the globe ever imagined.
2  •  A third concept is funding liquidity, which means the ease of firms, households or banks to meet their respective payment obligations with internal or external funds as they fall due. All these concepts are – of course – closely interrelated. Deviations from expected developments in any of these areas can cause severe disruptions. This is the essence of liquidity risk.