Week In Review: The Fed has painted itself into a corner
weeklytearsheet.substack.com
Who would want Jerome Powell’s job right now? Last week, we saw further pain in the banking sector as Silicon Valley Bank filed Chapter 11, Signature Bank was seized by regulators, and First Republic got a quasi-rescue. The interesting this about the bank failures this time around was that there was no interest from buyers. In the crisis of 2008, the government engineered a rescue by telling the big banks JP Morgan, Bank of America, Wells Fargo and Citi to buy up Bear Stearns, Washington Mutual, Countrywide, Merrill Lynch, etc. This is historically how governments handle these things. And that probably would have happened this time around except for the fact that the government punished these buyers for their good deeds during the Obama administration. JP Morgan did the government a favor, and got fined over Bear’s sins. Jamie Dimon ran Morgan back then, and I am sure he had a “fool me once” outlook on partnering with Washington. Can’t say I blame him.
Week In Review: The Fed has painted itself into a corner
Week In Review: The Fed has painted itself…
Week In Review: The Fed has painted itself into a corner
Who would want Jerome Powell’s job right now? Last week, we saw further pain in the banking sector as Silicon Valley Bank filed Chapter 11, Signature Bank was seized by regulators, and First Republic got a quasi-rescue. The interesting this about the bank failures this time around was that there was no interest from buyers. In the crisis of 2008, the government engineered a rescue by telling the big banks JP Morgan, Bank of America, Wells Fargo and Citi to buy up Bear Stearns, Washington Mutual, Countrywide, Merrill Lynch, etc. This is historically how governments handle these things. And that probably would have happened this time around except for the fact that the government punished these buyers for their good deeds during the Obama administration. JP Morgan did the government a favor, and got fined over Bear’s sins. Jamie Dimon ran Morgan back then, and I am sure he had a “fool me once” outlook on partnering with Washington. Can’t say I blame him.