/biz/ - Business & Finance

>>7617125

This means its a credit freeze.

You give your money to the bank and your bank loans it out to its costumers. However sometimes more people want their moneyback then people pay back their loans or the opposite case. In this situation banks borrow money from other banks.

Since this situation has not changed this means that banks do not loan out their money any longer to other banks because they do not trust each other.

The result will be liquidity problems for banks that need the money. This can result in mass bankrupcies of banks and financial institutions in general.

12 billion should be more than enough to grease these wheels. Next crippling problem

>>7617644
>Since this situation has not changed this means that banks do not loan out their money any longer to other banks because they do not trust each other.
this isn't true, or perhaps is overstated. They do trust eachother, but they know they can't pay eachother back.

>>7617125
It means banks don't have to borrow money because Trump saved the economy and sending the jews to gitmo. 20 years bull market.

>>7618834
Back to /pol/ boomer subhuman

>>7619131
>>>/leftypol/

>>7617125
has interbank lending ever dropped this fast and low before?

>>7618834
Fuck you.

>>7618407
>jews trust other jews not to jew them
AHAHAHAAHAHAHAHAHAHAHAHA
Public Edjewcation still hasn't taught what the (((bankers))) were doing selling subprime mortgages to each other? What a coincidence.

>What could that possible mean? Was it planned? If yes, by whom?

>>7619676
No it hasn't

>>7617125
this is bad

jesus fucking christ can we get a serious answer? Too much of a brainlet to comment on this myself

>>7620010
it can mean alot of things. it can mean that banks no longer need much liquidity to run their operations and have enough reserves themselves so its good, or it can mean they all have liquidity problems and not many can lend which is bad

>>7620146
It actually means only one thing.
Instead of getting loans from other banks it is generally cheaper to get the loan from the feds.

This cant be good. My brainlet analysis is that the 2008 crash and the sharp reduction in interbank loans happened at the same time, so probably all over again. On the other hand its so low already with no increase compared to pre 2008 crash

>>7619738
why though you some kind of libtard faggit or something? or just a spinless little jewish worm slithering around in here?

Interbank lending is probably the most misleading indicator for plebians. Of course /biz/ neets think it's the end of the world

>A sharp decline in transaction volume in this market was a major contributing factor to the collapse of several financial institutions during the financial crisis of 2007.

Interbank lending is mainly used to maintain liquidity and meet liquidity requirements, banks that have large amount of liquidity lend money to profit off it, there are a few possible explanations for this the current state,both are horrible.

1. Banks are keeping their liquidity in the face of a possible market crash or they're predicting that a lot of banks might be exposed to risky investments and have decided to not lend the money and keep the liquidity for self preservation.

2. Very few banks actually have excess liquidity excess and they're being cautious about counterparties.
If few banks have liquidity excess this means most banks are overextended and won't be able to meet their liquidity requirements and a market dip would turn into a massive crash.

>>7620284
They aren't loaning from the FED either

https://fred.stlouisfed.org/series/DISCBORR
https://fred.stlouisfed.org/series/IBLACBW027SBOG

>>7620146
If they have excess liquidity then they would lend it, no bank would just keep liquidity for no reason, and if you're implying that all banks have the exact amount they need to meet their requirements in perfect balance with each other then you're borderline retarded.
Banks constantly loan money to meet changing requirements, as they profit, lend money, lose, etc, they only keep the liquidity they need to meet requirements the rest they need to re invest to make profit, that's how banks make money, they don't make money off keeping unused liquidity, a bank would only keep excess liquidity if lending becomes too risky.
>>7620284

They're not, and if they were doing it the LIBOR–OIS spread would go down and inter bank lending would become attractive again and banks would be lending money to each other again, as the money from the feds is used to invest, keep liquidity, lend money etc, it would circulate, excess liquidity would be build and banks would lend to each other again.

>>7620336
watch commodities

OH NO NO NO AHHHHAHAHAHAHAHA

>>7617125
Gee I wonder if anything weird was done in the past 8 years to prevent it from happening earlier.