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I think you're missing a key point that because of the 2008 crisis the regulations were updated. Bank reserves are higher now than pre-2008. So in fact this is
by dkasper 5y ago
I think you're missing a key point that because of the 2008 crisis the regulations were updated. Bank reserves are higher now than pre-2008. So in fact this is basically like the OP said, regulators regularly mess up, and then update the regulation.
- lupire 5y agoIIRC the Fed is currently removing reserve requirementa because they don't believe they are useful. Banks have reserves now because the government printed so much money to give them that they can't put it to any use.