Looks like we are getting a bailout

To support American businesses and households, the Federal Reserve Board on Sunday announced it will make available additional funding to eligible depository institutions to help assure banks have the ability to meet the needs of all their depositors. This action will bolster the capacity of the banking system to safeguard deposits and ensure the ongoing provision of money and credit to the economy.

The Federal Reserve is prepared to address any liquidity pressures that may arise.

The financing will be made available through the creation of a new Bank Term Funding Program (BTFP), offering loans of up to one year in length to banks, savings associations, credit unions, and other eligible depository institutions pledging U.S. Treasuries, agency debt and mortgage-backed securities, and other qualifying assets as collateral. These assets will be valued at par. The BTFP will be an additional source of liquidity against high-quality securities, eliminating an institution’s need to quickly sell those securities in times of stress.

With approval of the Treasury Secretary, the Department of the Treasury will make available up to $25 billion from the Exchange Stabilization Fund as a backstop for the BTFP. The Federal Reserve does not anticipate that it will be necessary to draw on these backstop funds.

After receiving a recommendation from the boards of the Federal Deposit Insurance Corporation (FDIC) and the Federal Reserve, Treasury Secretary Yellen, after consultation with the President, approved actions to enable the FDIC to complete its resolution of Silicon Valley Bank in a manner that fully protects all depositors, both insured and uninsured. These actions will reduce stress across the financial system, support financial stability and minimize any impact on businesses, households, taxpayers, and the broader economy.

The Board is carefully monitoring developments in financial markets. The capital and liquidity positions of the U.S. banking system are strong and the U.S. financial system is resilient.

Depository institutions may obtain liquidity against a wide range of collateral through the discount window, which remains open and available. In addition, the discount window will apply the same margins used for the securities eligible for the BTFP, further increasing lendable value at the window.

The Board is closely monitoring conditions across the financial system and is prepared to use its full range of tools to support households and businesses, and will take additional steps as appropriate.

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how do i access the telegram?

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Any thoughts on FRC? Absolutely hammered pre market and as far as i know they are a pretty conservative bank.

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Sounds like the Fed will be offering loans to banks w/ liquidity issues... they'll be able to pledge long dated tsys as collateral, being **valued at par**

Aka bailout.

Tide went out and they got caught swimming naked.

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You are correct to he somewhat cautious and perhaps even fearful given the current economic and geopolitical situation, but IMHO the consequences this event should be relatively easy for the Feds to contain even though complicated by the current Fed policy concerns regarding inflation. This is not the type of systemic institutions problem that occurred during the S&L crisis of the Great Financial crisis, although there undoubtedly will be other managements who took stupid interest rates bets as these guys did and who forget about how volatile their funding sources might be come. Or who believe that crypto really is a currency when it lacks major aspects of a currency. So glad that you hold the assets you do . But as someone who has been involved in the financial markets for over 65 years ( yes, I am that old) don’t make the mistake of many perennial bears by letting your caution cause you to wait for the perfect buying opportunity , which seldom comes and is usually not recognizable until after the fact, or you will miss m any opportunities to achieve far greater than market returns. Instead just focus on tilting the risk/reward probabilities of each investment heavily in your favor and the diversify your equity and/or debt portfolio.

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“Little did I know, a bank would fail a few weeks later after writing these words…” incredible ‼️

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