5 ms·

It's worse than "shadow bank". It's bank who is allowed to print money at its whims and create any arbitrary leverage it wants.

• eru 4y ago
  Well, that's what the 'shadow' in 'shadow bank' means: less/different regulation than a normal bank. That's not necessarily a bad thing, btw.
  • refulgentis 4y ago
    Where's the "bank" in this "shadow bank"? You're describing a casino with a money printer.
    • eru 4y ago
      "Shadow banks" aren't necessarily "banks". See https://en.wikipedia.org/wiki/Shadow_banking_system https://en.wikipedia.org/wiki/Shadow_banking_system > The shadow banking system is a term for the collection of non-bank financial intermediaries (NBFIs) that provide services similar to traditional commercial banks but outside normal banking regulations.[1] Examples of NBFIs include insurance firms, pawn shops, cashier's check issuers, check cashing locations, payday lending, currency exchanges, and microloan organizations.[2][3] The phrase "shadow banking" is regarded by some as pejorative, and the term "market-based finance" has been proposed as an alternative.[4]
      • headsoup 4y ago
        You're moving the goalposts a bit there
        • vba616 4y ago
          The phrase already existed. If there was no more to it than you could immediately guess from the words, then it would be a useless term.
    • lupire 4y ago
      What would you say a non shadow bank is? "Money printing" is "just" a reserve ratio near or less than 0.