Summary
Phil highlights the Federal Reserve’s March 15, 2020 decision to reduce reserve requirement ratios for member banks to zero (effective March 26, 2020). He frames this as the latest example of post-crisis deregulation that fuels the second half of the cycle — predicting US banks’ profits will surge after 2021 as this removal of reserve requirements frees up credit creation.
Key Claims
- The Fed reduced reserve requirements to zero percent effective March 26, 2020. — confidence: high
- This action eliminates all reserve requirements for US depository institutions. — confidence: high
- Post-crisis deregulation follows every land-price-led downturn (~18 years). — confidence: high
- This zero-reserve policy will fuel the second half of the cycle after 2021. — confidence: high