Liquidity and Securitization

In his seminal work, J. M. Keynes introduced the theory of liquidity preference to analyze the asset market and its workings, which leads to the simultaneous system of macroeconomics. His methods have since been taken to implement the standard macroeconomic analysis, with the liquidity being an established concept. This paper examines the liquidity preference from the view point of the theory of money and concludes that it is perfectly consistent with the concept of money, evaluates its significance for considering the securitization and looks at what the scheme have to be achieved in practical terms