3 ms·
Thank you. This is actually first comment that explains whats going on. Now since my understanding is that this is something relatively new (in terms of volume
by joering2 7y ago
Thank you. This is actually first comment that explains whats going on. Now since my understanding is that this is something relatively new (in terms of volume pumped in) can someone explains WHY this is happening? Why banks need to dip below the line so often these days. And is this behaviour can come eventually with some negatvie consequences to banks or individuals holding loans, stocks etc?
- IshKebab 7y agoWell, if you can trade all of your customers' money you make more profit! Yes your risk of collapse is higher, but that's somebody else's problem.
- PeterStuer 7y agoI would speculate that as this regulation dodge vehicle is being increasingly needed to be invoked, that means that the regulation is being skirted to a higher degree than in the past. Since the regulation was introduced to reign in irresponsible freewheeling and extreme risk taking by banks, the logical conclusion must be that the banks despite the regulation that was intended to keep them into a position that was in line with their public responsibility are at it again.
- joering2 7y agoSo less regulation allows banks to use their clients money more aggressively. Then why would banks need to borrow so much money? And if its returned overnight, then why is FED keep pumping more and more? Can something bad for market come out of it? Like one of big bangs bankrupting or something?