Joe Biden, the man who was supposed to “build back better,” is doing the exact opposite. Instead of delivering on his promises, he’s presiding over one of the worst financial crises in U.S. history. It seems like every other week; we hear about another bank failure, leaving taxpayers on the hook for billions of dollars.
But who’s really to blame? The Federal Reserve’s interest rate regime is causing problems across the sector, and the government’s increasing willingness to use taxpayer money to bail out these institutions is creating a bad incentive for private banks to acquire or bail out failing institutions.
The bank failures are largely blamed on interest rate hikes that the Federal Reserve has pursued over the last year. Economist Stephen Moore points out that the Fed had to take these actions because of the government’s reckless spending spree after COVID, which led to inflation rising to 9%.
As a result, private banks may become less willing to acquire or bail out failing institutions because of the precedent set by government bailout packages. This is creating an environment of moral hazard, where private banks are less willing to take on risky assets.
It’s time for the government to take responsibility for its actions and create a consistent strategy for the financial market. The banking system is at risk, and the government’s inconsistent operations in financial markets have led to three of the four largest bank failures in U.S. history.
Joe Biden’s administration must learn to balance its spending with responsible financial policies to prevent further financial instability. American jobs and small businesses depend on a stable financial system, and it’s time for the government to strengthen the rules for banks to protect them.
In conclusion, Joe Biden’s presidency has been a disaster for the financial sector. The government’s inconsistent operations and reckless spending have created an environment of moral hazard, leaving private banks less willing to take on risky assets.
It’s time for the government to take responsibility for its actions and create a consistent strategy for the financial market to prevent further financial instability.
Source Fox News