The term, named for the late American economist Hyman Minsky, refers to the end of an economic boom that has encouraged investors to take on so much risk that lending exceeds what borrowers can repay. At that point, any destabilizing event may force investors to sell assets for cash to repay their loans, sparking a market meltdown.
In the past week, investors have contended with several US bank bailouts, market volatility, the collapse of Credit Suisse and the European Central Bank’s 50 basis-point rate hike. Next up is the Federal Reserve’s policy decision on Wednesday and the choices it makes to address both the banking crisis and high inflation.
“Even if central bankers successfully contain contagion, credit conditions look set to tighten more rapidly because of pressure from both markets and regulators,”
A MINSKY MOMENT.......per yahoo FINANCE ( p.s. THEY HAVE I.D. 180 MORE banks,in distress)
Last edit: 21 Mar 2023 08:36 by homeagain. Reason: add
Push me-pull me.
The Fed is trying to tamp down an overheated economy by raising interest rates.
Meanwhile incumbent politicians are trying to create as much new spending as possible before the 2024 elections.
Who will win?
Thomas Sowell: There are no solutions, just trade-offs.
