Fed Discount Window Weekly Update
This week’s Primary Credit activity at the Fed’s Discount Window:
This week’s primary credit balance was $1.4 billion, down from $1.6 billion a week ago.
My bank credit concerns are less today than a week ago now that the Fed has lowered its Fed Funds rate, which will help reinflate banks’ fixed income investment portfolios, especially that of Bank of America, which was truly mismanaged under Brian Moynihan’s leadership. In fact, Powell saved BofA and Moynihan (who would step down if he had an ounce of humility). BofA had more than $100 billion in unrealized losses as of June 30th as a result of having gorged on Treasuries and mortgage-backs when rates were at or near zero, believing that rates would never climb.
The Fed has created moral hazard amongst the CEO class who now expect to be bailed out.
