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Why is this at all surprising? Banks buy fixed-interest-rate debt/bonds with deposits. Then the fed raises rates by a huge amount quickly, resulting in FMV of t
by yuliyp 3y ago
Why is this at all surprising? Banks buy fixed-interest-rate debt/bonds with deposits. Then the fed raises rates by a huge amount quickly, resulting in FMV of that debt dropping significantly, so lots of banks are insolvent if you were to mark-to-market their loans / treasuries.
- Scoundreller 3y agoQuestion is why are banks issuing 25 year fixed mortgages at rates that nobody would buy a 25 year CD at? Do banks even sell 25 year CDs?
- robocat 3y agoWorldwide, the USA is odd, read the PDF at: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=1683472 https://papers.ssrn.com/sol3/papers.cfm?abstract_id=1683472 It discusses it a bit.