HN user
banks traditionally borrow short to lend long. that is how profit and loss capability is generated. that is the s&l proverbial plan. its built into the design and is not a flaw. the problem is expecting the taxpayers to bail the players out when things do not go according to plan and the banks turn out to stink at their jobs.
author of article is kind of an idiot. you too can buy us bonds (the 4% he refers to) you just are locked in for 30 years. banks give you less yield because you can get your money out quickly.
what he should say is that the us govt programs to support the market are really used to prop up bank earnings through the yield curve instead of a direct recapitalization. an individuals choice not to save does nothing to "screw the man."