4min chapter

Forward Guidance cover image

Nick Timiraos: The Fed Doesn't Want Bank Failures In The News

Forward Guidance

CHAPTER

The Federal Reserve's Role in the Dodd-Frank Act

In 2008, Lehman Brothers and Bear Stearns were not banks who had a lot of commercial depositors. So the Federal Reserve could say, oh, this is kind of our lane. But if you're replacing low cost deposits with 4.5% overnight money, then you're dealing with Iran. It depends on whether the bank is an FDIC regulated bank or a Fed regulated bank.

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