Keeping it Simple | Ep. 22: Bank Runs Are Good For Stocks? Right?
Keeping it Simple with Simplify Asset Management
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The Relationship Between Senior Loan Officers and Financial Conditions Indexes
Lacey: We are unquestionably seeing senior loan officers tighten conditions, even as financial condition indices which focus on spreads are tightening or showing that the financial conditions are loosening. This is actually a byproduct of Fed policy of hiking interest rates, which tends to compress spreads in the absence of panicked borrowing,. What causes those spreads to blow out is the equivalent of Silicon Valley Bank going on Friday of last week. Lacey: When you withdraw that liquidity, when you bring it off of peak, I don't care what the level is in absolute terms, you're rapidly tightening conditions and forcing the potential for liquidation of assets.
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