Primary Dealers Get Flattering Marks on Collateral for Fed Loans

In case you didn't already know this: `` Note also that the Fed’s accepting the clearing banks’ valuations on the assets that the brokers present as collateral. That is so very understanding of them. Given that the clearing banks hold similar assets themselves, they are probably grading on a curve here, so as not to mark down their own assets simultaneously, I’m guessing. We’ll give the best student here an A—make that a triple A!—and hey, look, we’re all triple A on this bus. Yikes.'' -- Yes; the whole point of this exercise is to REMOVE market pricing discipline, not add it. No surprise here.