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You may be confusing solvability and liquidity. You may be well capitalised but if you run out of cash it's game over. Being well capitalised only protects you
by cm2187 4y ago
You may be confusing solvability and liquidity. You may be well capitalised but if you run out of cash it's game over. Being well capitalised only protects you against losses (eg bad loans).
- nradov 4y agoNo, that's not how it works. Solvent, properly capitalized US banks can obtain cash from the Fed as needed to manage liquidity issues.