Banking intermediation and shadow finance: essays on the roots of shadow banking.

Summary The unprecedented scale of the 2007-2008 financial crisis has given rise to a vast literature devoted to the analysis of the phenomenon of Shadow Banking, which is considered to be the main culprit of the banking and financial debacle of the Great Recession, without providing a comprehensive understanding. The objective of this thesis is, using a positive approach, to study the roots and dissect the Shadow Banking phenomenon, which is essential to identify its complexity, establish a global understanding and understand its central role in the financing of the economy and money creation. Before being normative, this study requires above all a positive approach that must present facts and mechanisms from an analytical point of view. To this end, this work contributes to the existing literature by proposing a progressive approach that exposes the tools of the supposed migration of banking risks off the banks' balance sheets and disentangles the truth from the fantasy in an in-depth reading of the issues at stake in shadow banking. In this logic, the first chapter of this thesis focuses on what seemed to be at the origin of the 2007-2008 crisis, namely the circulation of assets and risks of banks through the sale of bank credits. It is established that the transfer of banking assets in its modern form has been a reality for more than forty years, weakening the hypothesis of a recent phenomenon guilty of the original sin leading to the crisis, this burden seeming to devolve upon securitization. The second chapter of this thesis is thus devoted to the study of securitization, and more particularly its origins and mechanisms. Like the sale of credit, the hypothesis of a recent phenomenon is quickly dismissed by the rich and long history of the securitization process, which spans over four centuries. In contrast to a nascent and uniquely American phenomenon, securitization reveals European and ancient roots that are far from being devoid of a certain instability. On the other hand, it is a fact that the modern form of securitization owes its pattern to the American public sector which, by its choice to privilege commitments over the holding of assets, has maintained the mirage of a Midas blessing supposed to allow the creation of quality ex-nihilo. If this fable is far from being sustainable, the fact remains that securitization can be a virtuous process of quality and yield distribution made possible by the reduction of information asymmetries, accompanied by a significant improvement in the liquidity of financing. However, it is still the preferred medium for banking regulatory arbitrage made possible by the wait-and-see attitude of regulators. Finally, in light of these necessary insights into the tools of modern finance, the third chapter of this thesis is devoted to the study of shadow banking. After exposing and denouncing the clichés, it offers a reading of the phenomenon that goes beyond the simple fantasy of a parallel banking system hidden in the shadows by proposing a reading that progressively leads to questioning the shift of the financial system towards a dynamic of intensive collateralization. This multiplication of insurance then finds its paroxysm in the emergence of a new monetary hierarchy, with central banks abandoning their prerogatives to the private sector: for nearly a century, banks have had the capacity to create money, which has gradually been ceded to shadow banking. This third chapter calls for further reflection on the place of the bank in the financial system and on the future of money creation, which is increasingly escaping from central bankers.