If depositers don't lose money then it's a bailout, change my mind
Discussion
Don't think I will
It’s an insurance pay out
It's definiately a bail out, but they're counting on the held to maturity value when accounting. The money comes out of a tax payer funded program, now, but long term those bonds do pay 100% instead of the 70% current market value. Not to mention the interst they charge.
This is the whole point of having a central bank and a government bond as the 'reserve' of your system...
Unless that government defaults....
Normally I would say “government can’t default, it’s gonna be an inflationary exit”
But the people in charge do so many stupid and dangerous things — like pushing a nuclear war — that I feel no confidence they won’t just let everything collapse hard.
It’s a crazy game. And the players are even more insane.