It certainly feels like 2000 again…

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Repo, Debt and Bond Markets in Financial Crisis 2.0, Michael “Big Short” Burry CRASH is Coming

The REPO market, where banks are buying short-term treasuries on an epic scale, on face value this can be explained that the banks are reluctant to lend and so Banks awash with cash are parking their excess deposits with the central banks so that they do not have to increase their capital reserves to cover the excess deposits as the following graph illustrates…It certainly feels like 2000 again.

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Morgan Stanley: The US Consumer Is Headed For A Double-Dip Recession

Two weeks ago, well before most banks slashed their GDP forecasts (most notably Goldman who took a machete to its Q3 GDP estimate of 8.5% and now sees just 5.5% growth in Q3), we noted that “a sudden negative change” had taken place in the economy, predicting (correctly) that retail sales would be a big miss (they were).

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