Some bankers sing this morning instead of ‘Purple Rain, Purple Rain’ – “Margin call, Margin call!”
Last week’s biggest news is not the Nonfarm Payrolls, or the European Central Bank or even Portugal’s government falling. No – the big deal is the openness with which the Federal Reserve is preparing a major margin call on the too-big-to-fail banks in the US.
This has been a long time coming since the introduction of the Dodd-Frank law back in 2010 but it is a game changer. Remember all macro paradigm shifts come from policy impulses, often mistakes.
Fed approves step one in a three-step plan: Continue reading “The Margin calls are coming big way”