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Note that in this interest rate environment banks don’t need to buy bonds in order to get 4%. Currently the Fed’s reverse repo facility provides more than that.
by jgilias 3y ago
Note that in this interest rate environment banks don’t need to buy bonds in order to get 4%. Currently the Fed’s reverse repo facility provides more than that.
- lazide 3y agoThe issue is it takes years (decades) to stand up a new bank due to the extensive regulations, processes, etc. that need to happen - and who knows what is going to happen next year - let alone in that timeframe. The reason why we have such consolidation is that merely existing in the Byzantine world of banking regulations is nearly impossible, and only the largest entities can afford the legal, IT, trading/financial mojo, capital, etc. resources necessary for it to occur. The big 5 have not only such resources, but enough economic impact if they fail that they can force regulators to stop doing a regulation that would kill them. Which is ultimately where this is all going. Either nationalization (unlikely) or the big banks writing their own regs (in practice).