Government Loan-Backed Securities (GLBS) for Long-Term Deficit Financing
Year: 2025
Type: preprint
Abstract: This white paper explores the concept of Government Loan-Backed Securities (GLBS) as a mechanism for financing state and federal government deficits through long-term bank loans (30-50 years) that are pooled, securitized, and sold to investors by a syndicate of banks. The structure can be enhanced through Federal Reserve involvement to lower borrowing costs and improve market liquidity. Cost modeling suggests that, with securitization and potential Fed guarantees, GLBS could approach or even match the cost of long-term government bonds while diversifying funding sources.
Source: SSRN Electronic Journal
DOI: 10.2139/ssrn.5400409
Author: Christopher Soans
Language: English
Subfield: Finance
Domain: Social Sciences
Open Access status: green
OpenAlex ID: W4413276767