Interesting. This issue feels super important to pay attention to. Rappaport's substack article seems good too, I'll read it over.
This bailout might be enough to temporarily prop up this system. Or it might be too little, too late.
Since this system is so dysfunctional already, do you think that "too little too late" is a good thing? Or do you think we'll be heading straight to a centralized digital currency?
I mean too little from regulators in the sense that capital requirements etc are obviously insufficient to prevent bank runs, contagion, etc. The Fed moved to protect depositors at SVB and Signature, and to essentially insure troubled assets, but this was too little too late to eliminate systemic risk in the total banking system. A possibly large number of small and mid sized banks may fail this year. I don't know if this is a good thing or a bad thing, and it might be both.
CBDCs are being tested now, and if there are cascading failures in the banking system, they may indeed be introduced sooner rather than later.