Friday Flush Sticksave Provided By Fed, As Basel Capital Charge Requirement "May" Be Lowered From 3% To 2-2.5%

Tyler Durden's picture

Nothing like the Criminal Reserve announcing at 2pm on Friday, just as the market was about to flush all stops to the bottom that the already laughable 3% capital charge buffer (initially expected to be 9%) required by Basel may be reduced even more (according to NY Fed mouthpiece Steve Liesman, a hypothetical which will likely be refuted before long), probably down to 2-2.5%. This number is woefully inadequate to protect financial companies from the the material capital infusion that will be needed post the onboarding of $200+ trillion in OTC derivatives to exchanges as we reported previosuly, but who the hell cares: must kick the can down the road one more day.

XLF's knee jerk reaction.