Finance Minister ready to take additional measures to protect bank deposits

Finance Minister ready to take additional measures to protect bank deposits

Finance Minister Janet Yellen suggested that her department could be willing to continue to support bank deposits if necessary, just a day after it was apparently excluded.

The brief fluctuations of the bank stocks followed, which then continued their daily downward trend.

are deposits secured or not?

in her Prepared certificate before the house approprropriations subcommittee on Wednesday repeated yellen Comments from the previous day explains that the recent government consisted of ensuring the security of American deposits.

However, she removed a keyline from the statement from Wednesday, in which she claimed "the US banking system was safe and healthy", and now inserted an explanation that the Ministry of Finance was "ready to take additional measures if this is justified".

"As I said, we used important instruments to act quickly and prevent infection," said Yellen, "and these are instruments that we could use again. The strong measures we have taken make sure that the insoles of the Americans are safe."

The comments seem to contradict Yellen's explanations on Wednesday before another sub-committee of the Senate, according to which the Ministry of Finance was not considering a "flat rate" guarantee for banking contributions without the consent of the congress, which would lead to a subsequent slump in bank shares.

These earlier comments also contradict their . Your repeated flip-flop on this topic has voices within the crypto community, which you call bluff, which indicates that the government is either incomprehensible or undecided with regard to a possible banking crisis.

Many of the measures of the Fed and the Ministry of Finance have recently "inspired" more than normal.

just feel it through, draw on things, see what breaks, react if necessary, repeat. https://t.co/qtkrruyii3

- lyn alden (@Lynaldencontact) 23. March 2023

hold everything back

According to the Ministry of Finance's appeal against system-wide deposit insurance on Wednesday, billionaire Bill Ackman recommended would. This drain, he said, would accelerate by the unattractiveness of bank deposits because the Fed raises its key interest rate to 5 % on the same day.

Yellen previously claimed that the Fed would only be willing to secure deposits at banks that are considered "systemic risk" for the financial system. Critics have argues that such a promise would make sure that there is no incentive for the bank customer to keep his deposits at smaller banks, creating a two-stage system.

The stock of First Republic Bank fell by another 6 %on Thursday. Meanwhile, the Deutsche Bank share fell by 3 %, since Credit Default swaps that protect against the bankruptcy of the bank rose to highs that have not been achieved since the beginning of 2020.

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