The conundrum is not in what small banks should do, but what policy makers should do with small banks
Great article, as usual. Any thoughts on the possibility of narrow banks, or even tighter constructs and the FED's displeasure with such concepts?
A narrow bank will face double the issues of a small bank, given the lack of diversification in its asset base.
Such things could only exist with state sponsored support, in whatever form that is.
Yeah, but the RRP is exactly that, isn't it? It would be like a MMF but 100%.
Which is only just a step away from an account directly with the FED now that I think about it.
Great article, as usual. Any thoughts on the possibility of narrow banks, or even tighter constructs and the FED's displeasure with such concepts?
A narrow bank will face double the issues of a small bank, given the lack of diversification in its asset base.
Such things could only exist with state sponsored support, in whatever form that is.
Yeah, but the RRP is exactly that, isn't it? It would be like a MMF but 100%.
Which is only just a step away from an account directly with the FED now that I think about it.