4 ms·
> That is something like saying "the house is not falling down" - you don't need to say it if the house isn't at risk of falling down. I think the statement is
by lanza 4y ago
> That is something like saying "the house is not falling down" - you don't need to say it if the house isn't at risk of falling down. I think the statement is true right now, but they are hoping to stem the bleeding on bank balances.
If somebody asks "is the house falling down" and you ignore the question then that's worse than responding "no."
- pclmulqdq 4y agoI think that would be the only innocuous reason to include that line, but nobody really asked. The treasury and the FDIC have both been taking a lot of actions, like setting up 12-figure lines of credit and having banks deposit money in each other, without the market really "asking" for it, which makes me think that there's a decent chance that something is actually wrong (my guess here is that Bank of America may be insolvent on paper, depending on the duration of their outstanding loans and bonds). If the FOMC believed the system was strong, there was probably a lot of debate at the meeting as to whether to include anything. If not, the line would be included 100%.