In a recent revelation that is sure to send shockwaves through the banking industry, U.S. Treasury Secretary Janet Yellen openly admitted that uninsured depositors at failed banks will only be protected if officials deem that failing to do so would create a "systemic risk and significant economic and financial consequences." This, in effect, means that depositors at large banks are far more likely to receive protection than those at small banks. The implications of such a statement are far-reaching and deeply concerning, as it essentially pours lighter fluid on every small bank in America.
As wealthy individuals are not prone to ignoring such risks, it is expected that billions of dollars will be moved from small banks to large banks in the coming days, leading to increased stress on already vulnerable small banks. While one might question whether Janet Yellen fully comprehends the impact of her statement, it's also possible that she knows precisely what she's doing, as...
Subscribe to Veritas+ or log in to access the full article and unlock exclusive content.
|
