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Can the Federal Reserve get banks lending?

re: Can the Federal Reserve get banks lending?

 

The questions is Can the Federal Reserve get banks lending?

 

I don’t think so and here is a simple why (my opinion)…  in order for banks to stay solvent, their asset must be either larger or equivalent to their liability.  Banks’ asset is loans, the money they lend out.  And all we know what happened to the majority of these loans since 2008…

 

Banks need to do and are doing 2 things right now: 1. re-capitalize themselves with cheap capital provided by the government and 2. not make anymore bad loans.


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