The Federal Reserve to remove the 10% reserve requirement as of 3/26/2020

Discussion in 'Financial Cents' started by DarkLight, Mar 17, 2020.


  1. DarkLight

    DarkLight Live Long and Prosper - On Hiatus Site Supporter

    Federal Reserve Actions to Support the Flow of Credit to Households and Businesses

    The link is from the Federal Reserve itself so as to not dissuade anyone from reading due to political bent.

    The title says it all. The Federal Reserve has lifted the requirement that a bank have no less than 10% “cash” or liquid assets immediately available starting on Thursday, 3/26/2020. This ha been a requirement since the Great Depression and was instituted to limit the impact of a run in the banks.

    The relevant part is the last section and in my opinion it doesn’t matter why they say it or what they claim that 10% will be used for, this is a bad move with really only one long term outcome. My wife has been concerned that our oldest is going to graduate (from college) into a recession. This leads me to fear it could be a depression.

    This is real and it is not good.
     
    Bandit99, duane, Gator 45/70 and 4 others like this.
  2. 3M-TA3

    3M-TA3 Cold Wet Monkey Site Supporter++

    Wholly irresponsible
     
  3. ghrit

    ghrit Bad company Administrator Founding Member

    No reserve? That is beyond irresponsible. Should be raised, not reduced. Replace the cleats on your track shoes, the run is yet to start.
     
    Bandit99, duane, 3M-TA3 and 3 others like this.
  4. VisuTrac

    VisuTrac Ваша мать носит военные ботинки Site Supporter+++

    tis fine. the money is insured by the FDIC (us) and the federal reserve has the printing press (not us) so they can print money to cover deposits in case of a run and get paid back by us.

    Great deal for them. Us, not so much.
     
  5. enloopious

    enloopious Rocket Surgeon

    Take your money out now...
    But then again, who keeps money in a bank?
     
    Gator 45/70 and magicfingers like this.
  6. Bandit99

    Bandit99 Monkey+++ Site Supporter+

    Errrr….if I remember correctly many of the bank failures of the 2007/8 financial crash were caused by over extension where they lack the necessary reserves. Basically, what this means is they loaned more money than they had, a lot more. I think (I would have to fact check) but Clinton lowered the reserve rate which led to this problem and I thought they had changed in back (again, I would have to check) after the government - meaning the taxpayers - had to bail out the banks and etc... Now, they want to go back again? What, they aren't making enough money already? They are setting it to zero and notice they don't explain why suddenly after all these years and 'bailouts' "Reserve requirements do not play a significant role in this operating framework." This is bad...

    "In January 2019, the FOMC announced its intention to implement monetary policy in an ample reserves regime. Reserve requirements do not play a significant role in this operating framework.

    In light of the shift to an ample reserves regime, the Board has reduced reserve requirement ratios to zero percent effective on March 26, the beginning of the next reserve maintenance period. This action eliminates reserve requirements for thousands of depository institutions and will help to support lending to households and businesses."
     
    Last edited: Mar 18, 2020
    Gator 45/70 likes this.
  7. HK_User

    HK_User A Productive Monkey is a Happy Monkey

    Fed Reserve, the only group to take perfectly good paper, put on special printer's ink and ruin it for everything including TP.
     
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  8. VisuTrac

    VisuTrac Ваша мать носит военные ботинки Site Supporter+++

    They are ensuring that all the banks that aren't in the club (direct injection of billions of dollars already sitting in their vaults) fail on April 6th when the 1000 dollar checks come out. Previously, all the banks had to have 10 percent to cover deposits, now they can have zero. Checks come out, everyone takes checks and gets cash, banks run out of cash, bank holiday, FDIC says, well yeah, but it's going to take a few months before you can get your money, panic takes over and then the shooting starts. Instant maintaining of personal distancing, fewer infected coming in contact with non infected ...
    and pandemic ends.

    Seems pretty effective in my estimation. Also, fewer survivors for the FDIC to payout.
     
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  9. oil pan 4

    oil pan 4 Monkey+++

    Seems we had a topic on this, well cash anyways.

    Cash is king
     
    Gator 45/70 likes this.
  10. enloopious

    enloopious Rocket Surgeon

    Today you can not buy silver or gold. The price is at rock bottom and nobody has any. Do you remember the Amero? This is no accident and these are all related to Corona virus.
    North American monetary union - Wikipedia

    The Covid-19 plague that was released on us is THE plan to have the ruling class get everyone over into the one world government or NWO plan. This is the big step. Money is now dirty. All people are secretly infected. You need a digital currency because then you don't have to spread disease and $1200/mo paychecks to everyone. This allows, what the Amero failed to do, happen but at a much larger level and way easier. People are going to do it themselves happily.

    Now just imagine the powers of the Patriot Act (temporary for 18 years and running) applied to the entire world. You may have Covid-19 and not even know it! Prepare to be forced to take vaccines. Prepare to have cameras in your house (for your own protection of course). Prepare to lose your children because now you are endangering them by not following the plan.

    I used to think that Trump was crashing China by putting tariffs in place but now it seems as if he is playing right into their hands and not just a little bit. He brought out the biggest stimulus package in history and none of his opponents even complained about it. Not a single one. Do you think they would have let him do all of the stuff he did if they weren't in control of it? No opposition.

    I was watching Bloomberg and the host interviewed a senator and got mad and yelled at her for not uniting with both parties on the bail out and free money (socialism) but he didn't just yell at her, he was telling her what to do. He made demands of her ...and she said she would do it, back-peddled, like he was her boss. Who is in charge here?

     
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  11. mysterymet

    mysterymet Monkey+++

    Not true about not being able to buy physical gold or silver. Recently bought some from a friend who is a metals dealer in his “retirement job” and I am picking it up today after work.
     
    enloopious and Gator 45/70 like this.
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