“Could we simply choose to not be slow?” plus incentive compatibility is a surprisingly powerful mix, including in fields where it is not (yet) widely deployed. t.co/n6AIV07cPp
Me: Can’t sleep, wonder whether stuff hitting the fan yet. Guess I’ll check WSJ. *makes it to first headline* Me: Well that answers that.
I’m going to elude naming the bank, but I just got a friendly message from Interactive Brokers saying that accounts with a concentrated position in that bank’s preferred shares would effective immediately be margined based on a bespoke stress test and not the usual formulas.
I’m not sure whether this will take off (ba dum bum) but always good to see new fundamental innovation in logistics, particularly when it is shaped like something which would have struck almost anyone as a joke a few years ago. t.co/17RmqDRzBn
The first sentence is God's honest truth, and to be honest, it snuck up on me.
I also feel this, and feel like we’re in that relatively brief period before Of Course Everyone Always Knew That… t.co/bh2rgeOJJ2
A concept that I find useful for understanding the logic of deposit insurance is "local elites." In the typical context for a bank failure, a small town's community bank, you are trying to insure the mayor, the pastor, the principal, many local business owners, etc.
I went back and forth quite a bit on whether to invoke the word “crisis” and am a bit glad to see that the Overton window adjusted to include that having been a real risk on the same day: t.co/RYhOigFuG2
Today's Bits about Money is about the banking situation. You can find analysis about the three institutions that failed elsewhere; this is about what causes, institutional response, facts about the world currently underappreciated, and recommendations. t.co/qS8Y5zWXdR
Bits about Money will be out this morning U.S. time, covering the banking situation. I am currently trying to edit it to dial appropriate detail, nuance, and level of concern.