Wednesday, October 12, 2016

Gangster Government Under the Guise of Reform

In the wake of the financial crisis of 2008/09 when a small fraction of money market funds "broke the buck", the government has insisted reform was needed.


The government wanted to cripple its biggest competitor for short-term funding, the commercial paper market.  The reform's rubber has hit the road and, basically, mission accomplished.  One graph says it all.

Cheaper funding for the government, more expensive funding for the private sector.  Feature, not a bug of "reform".


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