How To Fix The Economy: More Loans, Not Bank Reserves! 3

The Fed gauges conditions in financial markets, and the markets try to predict the Fed - is this not a circular reference?

Without an equivalent in the business and consumer loan space, the Fed will not purchase private sector CLO securitizations, and the banks will not have a ready buyer of the loans that they make.

As a result, banks are not as incentivized to make new loans to businesses and consumers (relative to mortgages).

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