|"Notionally", I'm a sheep....|
Requiring "risky credit unions" to directly and "on balance sheet" reflect the actual level of risks being taken with insured member savings deposits enhances transparency - and, at least with NCUA, transparency has and always will be of paramount importance.
"Off balance sheet", notational capital immediately raises the legitimate concern of "moral hazard"- whereby a "risky credit union" can play "heads we win, tails you lose" with the NCUSIF. When the NCUSIF loses, your members lose.
Which, of course, leads us back to the fact that the "risky assets" which need to be "derived away" by risky credit unions are most often 30-year fixed rate mortgages. And, why would NCUA want to help keep the undeniably riskiest financial
product on the planet - which was the core source of the recent financial collapse and subsequent Great Recession - alive by putting the entire credit union movement "in play"?
Rather than having "risky credit unions" opt-in for derivatives, is there any way for the "other 95%" of credit unions to opt-out?