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Replying to Avatar Mike Brock

For what it's worth, claims that the Fed is turning the money printer on to bail out the banks doesn't seem quite accurate.

1. Because they're explicitly allowing these institutions to fail.

2. The banks have sufficient assets on their balance sheets to pay out all deposits. The only issue is the maturity dates on those assets, relative to deposit durations. The mechanisms they appear to be using do not seem to involve any injection of taxpayer capital or money creation by the Fed.

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Gerald Glickman 2y ago

Seems accurate , so far. We'll see how it goes tomorrow and this week. 🍿

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Mike Brock 2y ago

Based on what?

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Gerald Glickman 2y ago

https://www.fdic.gov/news/press-releases/2023/pr23017.html

Favorable rates, federally sponsored, it seems. Not an expert here, will be curious to read more details.

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Gerald Glickman 2y ago

Also: https://www.federalreserve.gov/newsevents/pressreleases/monetary20230312a.htm

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Gerald Glickman 2y ago

There is a systemic, generalized cost, though - that everyone pays to fund the insurance and reduced premium on federal loans, etc.

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