The Loose Financial Situation in La-La-Land Despite Fed Tightening and Bank Collapses.
Despite the Federal Reserve's tightening and bank collapses, financial conditions and lending standards are still looser than the long-term average, though they have become somewhat less loosey-goosey than during the free-money era. The weekly St. Louis Fed Financial Stress Index measures financial stress in the credit markets and was designed to indicate when another financial crisis might be at the doorstep. Loan demand is down from businesses and consumers, which makes sense because interest rates have risen, and borrowing has become more expensive and isn’t a freebee anymore. More loan officers on net reported tightening lending standards across the board, except for consumer mortgages backed by the government.