If they haven’t yet, they will eventually. Once banks realize that utilizing BTFP is kosher, they’ll run it all the way to its cap (which encompasses a little o

If they haven’t yet, they will eventually. Once banks realize that utilizing BTFP is kosher, they’ll run it all the way to its cap (which encompasses a little over $4T of distressed assets [0]) and reinvest the cash wherever they can. The mortgage rate will become pegged to the one-year rate and the housing market will resume its climb. Banks will still take a massive hit but they’ll bleed out slowly instead of crashing violently causing widespread panic in the process. [0] https://cryptohayes.medium.com/kaiseki-b15230bdd09e https://cryptohayes.medium.com/kaiseki-b15230bdd09e