Revi wrote:I guess it still isn't working! Banks are still afraid to lend each other money.
https://www.silverdoctors.com/headlines ... -not-a-qe/
sparky wrote:.
The fact that porn-doomers have been consistently wrong for 74 years doesn't prove that one day they will not be right
Revi wrote:I guess they have been pumping in an extra $104 billion just as insurance lately. I know it's just more stimulus, and we aren't supposed to get excited about it because nothing has happened, but what's going on? I would love some input from people who won't accuse me of being a godless communist just because I noticed that things are getting a little weird.
Revi wrote:Here's an interesting article on it.
https://www.silverdoctors.com/headlines ... derstated/
"According to what they do decide to tell the public, the Fed is engaging in daily interventions in the repo market.
Why?
The banks are not trusting something with the current financial system.
You see, in the repo market, there is zero risk.
Here’s how it works:
Bank “A” needs money.
Bank “A” goes into the repo market to enter into a repurchase agreement.
The agreement could be Bank “A” selling a US Government T-bill to Bank “B”, which Bank “A” will buy back from Bank “B”, at the same price, plus a smidgen of interest, the very next day.
Bank “A” gets that fast cash to keep the party rockin’ all night long, and Bank “B” gets to earn some sweet interest, absolutely for free, as Bank “A” is required to buy back the T-bill.
Here’s the problem: For more than a month now, Bank “B” has been unwilling to participate.
Here’s my first point, and I’ll ask it as a question: When is a financial institution, in this case a bank, not interested in free money?
And it’s not like this is “dirty money”, or anything criminal in nature, but rather, it is simply the latest active policy undertaken by the Fed.
Why is this such a serious issue for the markets and the economy?
Because the banks are not acting normal, in much of the same way that a rabid skunk does not act normal.
It is serious because we are not privy to the details of the scope or severity of the problem." From the article
pointing out underlying problems
StarvingLion wrote:pointing out underlying problems
Yeah, deteriorating quality of oil and catastrophic increase in oil field decline rate due to massive desperate reckless EOR.
Consequence: They're fucking HOSED
The money printing will never stop, it will increase, and its pure ROT.
You may as well jump off a bridge
Yoshua wrote:The global Repo market is a USD 5 Trillion daily operation.
If demand is higher than supply, then the price (in this case the interest rate) goes up.
We can at least conclude that demand is higher than supply.
What if the Repo demand has risen to USD 6 Trillion?
What if there are now two Bank A agains one Bank B?
Yoshua wrote:
Did the Repo spike only take place in the U.S market? Since the dollar is the world reserve currency there should have been signs of stress in the LIBOR and SHIBOR?
I have been reading that the LIBOR has been falling...and actually leading the Fed to cut rates.
Complicated stuff...
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