Fed’s Magical Accounting Might Save Banks but Doom Rate Increases
Wall Street Journal, Mar. 13, 2023–James Mackintosh (subscription)
Here we go again. Just two days before the 15th anniversary of the Federal Reserve-backed rescue of Bear Stearns, the central bank is offering easy money to banks to stop an incipient run on the sector. The immediate question is whether it will succeed. The secondary questions for investors are whether this marks the end of the rapid rate rises that trashed markets last year, and what lessons can be learned.