Friday, April 19, 2013

Fed Governor Stein Warns When A TBTF Bank Fails, Depositors Will Be Cyprus'ed

Stein has managed to stick his foot in his mouth for the second time in a row, and do what virtually nobody in the status quo is capable of: tell the truth.

In a speech titled "Regulating Large Financial Institutions" Stein made something very clear: if and when a TBTF fails, and since this time is not different, and a failure is only a matter of time, depositors will lose everything (courtesy of some $300 trillion in gross unnetted liabilities which once there is a counterparty chain failure, suddenly become very much net and immediately marginable -a drain of cash), which now that Cyprus is the template, is to be expected.

http://www.zerohedge.com/news/2013-04-19/fed-governor-stein-warns-when-tbtf-bank-fails-depositors-will-be-cyprused

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