The Epic American Credit and Bond Bubble Laboratory Message Board

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory

Public Reply Prvt Reply Mark as Last Read File

Previous 10 Next 10 Previous Next

To: ridingycurve who wrote (68904)	8/27/2006 3:46:09 PM
From: Ramsey Su	Read Replies (3) of 110194

ridinycurve, I am not old enough to remember <ggggg> but was it not the case, once upon a time, that the FED actually regulates CD rates? When that was deregulated, I believe that was the first wave of "Moral Hazard". When depositors chase after the highest rates, regulated institutions are tempted to offer higher rates in order to attract depositors and taking on additional risk in the process. If not for FDIC insurance, would depositors be more selective? Why do they make risky loans? I believe all it takes is one major player to do so and all competitors would be forced to do same, or stand the chance of being wrong by being too conservative and lose market share. In the subprime world, that was exactly what happened. Ramsey

Report TOU Violation

Share This Post

Public Reply Prvt Reply Mark as Last Read File

Previous 10 Next 10 Previous Next