The hottest Banking System Substack posts right now

And their main takeaways
Category
Top Finance Topics

The Fed's New Target: Part II

Concoda • 302 implied HN points • 15 Feb 26
💰 Finance Banking System
  1. The overnight fed funds rate is becoming unreliable because trading volumes have collapsed and rival interbank markets are emerging, putting the current mechanism near a breaking point.
  2. Since 2008, huge reserve growth has propped up the effective fed funds rate and hidden the decline in unsecured interbank activity, but that stability is fragile and no longer shows the true cost of dollar funding.
  3. The Fed will need a new target rate soon, and it is likely to consider options like administered rates (IORB or o/n RRP), an existing benchmark, a rates basket, or creating a new benchmark.

Monetary Policy Is Monetary Piracy

QTR’s Fringe Finance • 28 implied HN points • 06 Jan 26
💰 Finance Banking System
  1. State-run monetary policy acts like theft because creating money for private banks concentrates wealth with insiders and helps cause recurring financial crises.
  2. Money and banking should be separated from the state; legal tender laws and special banking privileges (like protections for fractional-reserve lending) enable monetary piracy and should be repealed so people can choose competing currencies.
  3. A free market for money, grounded in private property and competition, would produce sounder money and make financial actors accountable to customers rather than the state.

Does Private Credit Really Reduce Systemic Risk?

Without Warning • 235 implied HN points • 17 Jan 24
💰 Finance Banking System
  1. Private credit may offer stability due to duration-matched investments and reduced leverage in the banking system.
  2. Money moving into private credit doesn't necessarily reduce overall leverage in the system; just shifts it around.
  3. Private credit's growth can help banks manage capital risks and liquidity challenges, allowing for retranching and reduced regulatory capital requirements.
Get a weekly roundup of the best Substack posts, by hacker news affinity:

The Fed's New Rescue Mechanism

Concoda • 513 implied HN points • 13 Feb 24
💰 Finance Banking System
  1. The Federal Reserve's Bank Term Funding Program (BTFP) is expiring after being used to address financial panic and market stimulation caused by banks' underwater assets.
  2. Following a series of bank failures in the aftermath of COVID-19's speculative boom, the Fed introduced the BTFP to provide a confidence boost and stabilize markets.
  3. The BTFP evolved into a risk-free arbitrage opportunity for banks, leading to its rapid increase in volumes before its sudden discontinuation in March 2024.

Proceeding Recklessly

Ironsides Macroeconomics 'It's Never Different This Time' • 137 implied HN points • 23 Sep 23
💰 Finance Banking System
  1. The Fed's forward guidance has significant implications for market outlook, creating uncertainty for the rest of the year.
  2. There are concerns about a bear steepening of the Treasury Curve due to increased Treasury supply and reduced buyers.
  3. Housing affordability has been negatively impacted by monetary policy, leading to structural changes in rental rates.

The Transitory Pause

Concoda • 421 implied HN points • 10 Jun 23
💰 Finance Banking System
  1. The 'Transitory Pause' discusses the impact of the Fed's actions on the market.
  2. Despite concerns over market instability due to debt issuance, history suggests bond markets can handle it.
  3. High demand for sovereign debt and expectations from major market players may offset liquidity concerns.

The Fed's $300B Emergency Response

Apricitas Economics • 57 implied HN points • 18 Mar 23
💰 Finance Banking System
  1. The Federal Reserve lent over $300B in emergency funds to American banks to stabilize the financial system.
  2. Most of the emergency lending was short-term, with a majority of the funds coming from the discount window.
  3. Reforms to the discount window have helped reduce stigma around borrowing from the Fed during financial crises.

How the Banking System Changed Post-SVB

Apricitas Economics • 32 implied HN points • 05 Jun 23
💰 Finance Banking System
  1. After the collapse of Silicon Valley Bank, the American banking industry is adapting by relying less on uninsured deposits and more on alternative funding methods like borrowings.
  2. Deposits have restabilized post-SVB crisis, but banks are facing challenges with tight lending standards due to renewed economic pessimism and liquidity concerns.
  3. Banks are cautiously navigating post-SVB crisis by reducing reliance on uninsured deposits, managing securities losses, and addressing liquidity worries amid tighter monetary policy.

The Unraveling of the Soviet Ruble Zone

Vivid Leaves • 5 implied HN points • 07 Oct 23
🌍 World Politics Banking System
  1. The collapse of the Soviet ruble zone was like a heist more than a historical event, with countries exploiting the payment network to issue new rubles and ultimately leading to hyperinflation.
  2. The failure of the Soviet ruble zone showed the importance of payment networks in shaping path dependencies, highlighting the need for robust state capacity and careful negotiation in managing currency transitions.
  3. Countries like the Baltics and Ukraine left the Russian ruble zone early, showing the impact of geopolitical decisions on monetary systems.

#35 Manuel Silva: VC firm building, LP fundraising hacks, and the future of finance

Views • 0 implied HN points • 31 Oct 23
💼 Business Banking System
  1. Curiosity and diverse experiences play a key role in shaping a successful career in VC and fintech innovation.
  2. Building a corporate VC arm requires seizing the right opportunities, managing complex problems, and ensuring a personal fit.
  3. Lessons from Silicon Valley highlight the importance of strong relationships, ambitious thinking, ecosystem connections, and personal reputation.