All was quiet on the Bank Term Funding Program (BTFP) front this week. The Fed and FDIC avoided a pronounced recession back in March by creating the BTFP. Yet, there is no free lunch. The BTFP creates additional moral hazard among a generation of Banking executives and investors while further diluting the U.S. Dollar, thereby creating price inflation. The Capital Markets and U.S. Economy are not free systems so long as the Fed manipulates them.
