4min chapter

"Moment of Zen"  cover image

E15: Nic Carter on Balaji's Bet, Operation Chokepoint 2.0, and the Fed's financial crisis

"Moment of Zen"

CHAPTER

The Cost of Credit Disposal in the Economy

The Fed is grappling with the cost of ensuring all those uninsured bank deposits which if they don't do that people will just continue to leave for Treasuries or as long as banks there's no reason to stay at medium-sized and smaller banks. The political cost of allowing inflation a sky rocket here is inordinate so I think they'll just try and ease this issue of credit destruction by themselves getting into the credit allocation game, but it isn't an optimal outcome because we're trusting a single entity to then determine how credit is disseminated in the economy. We need to get Russian energy supplies back into the world and like you know all the other secondary things there too.

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