The Fed has become the de facto interbank market in the US. It takes cash deposits from commercial banks, in the form of excess reserves. It also lends to the banks through a dizzy array of acronyms, such as the TARP.The chart above compares the relative magnitude of these two activities. Unsurprisingly, Fed borrowing and lending are broadly the same magnitude.
However, a closer look at Fed lending reveals a worrying trend. It has begun to pick up, suggesting renewed banking sector difficulties? Are we in for another round of the credit crunch. I hope not. Enough already!
NIce word, Fedeal - makes them sound like Irish bandits.
ReplyDeleteB. in C.
If you're gonna drop letters, just call them the FERAL reserve!
ReplyDeleteThis short film explains it all clearly
ReplyDeleteI don't normally like to delete comments, but anything racist, sexist, rude or homophobic will get chopped.
ReplyDeleteToday, someone posted a particularly nasty anti-semetic comment. As soon as I noticed it, I deleted it. I also deleted a response. Once the offending comment was removed, the response had lost its context.
I hope everyone understands.
Alice