by Jonah Bennett, Freedom Outpost:
Bank regulators are now forcing financial institutions to hold more Treasury securities in an effort to ensure cash solvency in the event of another financial crisis, the Washington Examiner reports.
The reason given for why banks must now hold an additional $100 billion dollars of liquid assets is because these securities can easily be exchanged into cash at any time. Treasury securities are the top category for qualifying as liquid assets, although banks can fulfill the requirement through stocks, as well.
The move constitutes a major piece of regulation intended to avoid taxpayer-funded bailouts and yet another financial crash. In the event that banks need to pay back loans in a hurry, the extra liquidity will make sure they have enough cash to last for 30 days.
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