The chart below represents the scale of the Fed's backstops during systemic banking crises, and the contrast is staggering.
As you can see, the emergency backstop of 2008 looks like a mere speed hump compared to the massive liquidity facilities made available during the 2023 regional banking crisis, which witnessed the forced purchase of failing institutions to halt aggressive bank runs.
Today, replicating this kind of rescue is virtually impossible without triggering severe inflationary pressures. The fundamental difference between then and now is that during those previous banking panics, inflation was firmly under control.
Today, inflation limits their room to manoeuvre, any attempt to facilitate a rehearsal of past expansionary playbooks would completely implode bond yields.
The Fed is officially cornered.
Checkmate.👑♟️
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