Revi wrote:Fed has dumped in a lot of money. Consider that the US national debt only goes up about a trillion a year, so they've dumped in 1/8 of that just in the last week to keep this key rate down there.
https://www.forbes.com/sites/caitlinlong/2019/09/25/the-real-story-of-the-repo-market-meltdown-and-what-it-means-for-bitcoin/#5cf799147caa
For every US Treasury security outstanding, roughly three parties believe they own it.
Despite Repo Rate Debacle, Liquidity Isn't An Issue
There is, however, a considerable disparity between the current period of repo market turbulence and the far more widespread credit market stress of 2008. At that time, there was widespread concern over the financial health of lending institutions. Today, by contrast, banks posting record profits and the balance sheets of financial institutions are much stronger than they were in 2008. Against the present environment of strong corporate profits, low interest rates, and a strong credit market, the likelihood is high that the latest spike in overnight rates will prove to be a temporary anomaly and not the start of another crisis.
Eurodollars are time deposits denominated in U.S. dollars at banks outside the United States, and thus are not under the jurisdiction of the Federal Reserve. Consequently, such deposits are subject to much less regulation than similar deposits within the U.S. The term was originally coined for U.S. dollars in European banks, but it expanded over the years to its present definition.
http://en.wikipedia.org/wiki/Eurodollar
Revi wrote:Well that's a relief...
StarvingLion wrote:Revi wrote:Well that's a relief...
Revi believes in Facebook Currency for collateral...HAHAHAHAHAHAHAHAHA.
Revi wrote:Here's a vid that starts out with a discussion of the repo rate. Watch just the first 20 mins.
https://www.silverdoctors.com/headlines ... ing-truth/
Revi wrote:Here's a vid that starts out with a discussion of the repo rate. Watch just the first 20 mins.
https://www.silverdoctors.com/headlines ... ing-truth/
Repo glitches expose flaws in Fed’s approach
Central bank might have acted more quickly if the repo market were its primary target
Overnight repo rates — the interest rate paid to borrow cash in exchange for Treasuries for just 24 hours — began rising on Monday, September 16. But it was not until after 9am the next day that the New York Fed, which is responsible for implementing the Federal Reserve’s monetary policy, stepped in to try to ease the strain.
According to John Williams, president of the New York Fed, the announcement was timed to coincide with the release of data showing a rise in the effective federal funds rate. That makes the mandate for intervention clear.
...But the Fed’s sortie into the repo market — since repeated several times — has stirred conversations about whether policymakers are focused on the right short-term rate. Fed funds was once the driving force of cash markets. Now it is a back-seat passenger and repo is at the wheel.
...fed funds is hardly representative of the dynamics affecting short-term lending markets. As was seen in September, its basic function — to track the Fed’s target rate — has broken down, because it is now susceptible to movements in other rates such as repo rather than driving them.
...Since the Fed has started reversing QE, reserves have fallen and some — but not all — players have consequently run short of cash again. Such shortages are threatening the ability of the Fed to maintain control of the effective fed funds rate
http://www.ft.com/content/d2cd761a-e64d ... 5a370481bc
Fed to Keep Pumping Liquidity Into Repo Market Through October
By Alex Harris
October 4, 2019, 11:02 AM PDT Updated on October 4, 2019, 11:37 AM PDT
...The Federal Reserve Bank of New York said Friday that it will conduct operations for overnight repurchase agreements through Nov. 4, having previously only scheduled them through Oct. 10. The central bank also announced eight new term offerings to provide additional funding through this month.
...These measures are officially aimed at keeping the fed funds rate within the central bank’s target range. While those measures did bring the market more in line with this, there was a brief move upward in repo rates at the end of September as participants fulfilled quarter-end funding needs.
http://www.bloomberg.com/news/articles/ ... gh-october
phaster wrote:Revi wrote:Here's a vid that starts out with a discussion of the repo rate. Watch just the first 20 mins.
https://www.silverdoctors.com/headlines ... ing-truth/
interesting thesis [one that seems to make the most sense]
just happens last wed had an invite to hear what one of the NY fed officials had to say,...
John Williams John Williams
President, Federal Reserve Bank of New York
Vice Chairman, FOMC (@ucsd)
http://www.youtube.com/watch?v=nbnrCel6ZAk&t=43m49s
I'm just a basic science knucklehead that has never taken a formal economics or finance class,... but my math background tells me at some point the figures on the balance sheet,... don't balance
and as an interested spectator IMHO the only reason there has not been a problem thus far is because the dollar is the international medium-of-exchange/store-of-value/unit-of-account
http://www.investopedia.com/financial-e ... ncies.aspx
which sorta ties into the the dollar shortage [thesis] is being caused by speculators dumping dollars into USA shale (to keep the party going awhile longer since some producers like venezuela are offline AND as long as the dollar is used for settlements,... POTUS can continue his crusade against Iran, etc.)
FWIW found these news bits interesting,...Repo glitches expose flaws in Fed’s approach
Central bank might have acted more quickly if the repo market were its primary target
Overnight repo rates — the interest rate paid to borrow cash in exchange for Treasuries for just 24 hours — began rising on Monday, September 16. But it was not until after 9am the next day that the New York Fed, which is responsible for implementing the Federal Reserve’s monetary policy, stepped in to try to ease the strain.
According to John Williams, president of the New York Fed, the announcement was timed to coincide with the release of data showing a rise in the effective federal funds rate. That makes the mandate for intervention clear.
...But the Fed’s sortie into the repo market — since repeated several times — has stirred conversations about whether policymakers are focused on the right short-term rate. Fed funds was once the driving force of cash markets. Now it is a back-seat passenger and repo is at the wheel.
...fed funds is hardly representative of the dynamics affecting short-term lending markets. As was seen in September, its basic function — to track the Fed’s target rate — has broken down, because it is now susceptible to movements in other rates such as repo rather than driving them.
...Since the Fed has started reversing QE, reserves have fallen and some — but not all — players have consequently run short of cash again. Such shortages are threatening the ability of the Fed to maintain control of the effective fed funds rate
http://www.ft.com/content/d2cd761a-e64d ... 5a370481bc
also in the fed repo related news,...Fed to Keep Pumping Liquidity Into Repo Market Through October
By Alex Harris
October 4, 2019, 11:02 AM PDT Updated on October 4, 2019, 11:37 AM PDT
...The Federal Reserve Bank of New York said Friday that it will conduct operations for overnight repurchase agreements through Nov. 4, having previously only scheduled them through Oct. 10. The central bank also announced eight new term offerings to provide additional funding through this month.
...These measures are officially aimed at keeping the fed funds rate within the central bank’s target range. While those measures did bring the market more in line with this, there was a brief move upward in repo rates at the end of September as participants fulfilled quarter-end funding needs.
http://www.bloomberg.com/news/articles/ ... gh-october
StarvingLion wrote:Gee, its nice of these crims to tell us the bank runs begin on Nov 5.
Outcast_Searcher wrote:There are clowns who sell "investment advice" who tell us that a major stock market crash will happen month X, EVERY YEAR.
And some of them are even good enough to just change the year, EVERY YEAR, and repeat the same claim, extending the ad.
like your constant claims we'll all be starving
phaster wrote:personally I follow two market sayings "the trend is your friend..." AND "time in markets, not timing of markets" BUT have a hedge of sorts which is "I never bet money you can't afford to lose,..."
so far so good,...
StarvingLion wrote:like your constant claims we'll all be starving
Well, I was at the local Ford Dealership yesterday and they had giant bins to 'Fight Hunger'. Why would that be in a dealership?
Answer: The Internal Combustion Engine means the kids get thrown under the bus. TINA.
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