Is this some of the moral hazard that I've heard so much about?
A sweet catch from Charlie Bilello:
Silicon Valley Bank is now marketing themselves as the single safest "place to keep or transfer your deposits (fully insured with no limits or caps)." pic.twitter.com/HLg6D0q5We
— Charlie Bilello (@charliebilello) March 15, 2023
Related: our the comment a few posts down page:
If depositors are being made whole on uninsured funds, and depositories can borrow against underwater assets at par rather than marked-to-market prices, then we might as well lift the Fed's policy rate by 2% to get the inflation adjusted real rate up to zero from the current -2% and put a stake through the heart of inflation right now.
On a slightly more politically-realistic note, I'm telling you there is something about the idea of shrinking central bank balance sheets that scares the bejeebus out of the central bankers.
