So, how deep down the rabbit hole are they and will other banks follow that move? If financial institutions are endangered once again and customers see their credit scores reduced (meaning higher interest on their credits) and get driven toward more risky (and more expensive) forms of credit, potentially margin loans that could be called even in a moderate stock market correction, how more tense are we making the stock market and how much self-reinforcing effects are we building in it so that bad things can funnel worse things quickly?
Cutting liquidity goes opposite to the current policy of central banks, I’m curious to see what may unravel out of it. We’ve already had the Archegos-Crédit Suisse adventure. I’m not ready to act upon it but my bet is that a market correction is near.
Edit: to make my thinking more clear: tightening credit is one of the trigger of stock market crashes. I don’t like where this is going.