Wall St. For Main St., Released on 5/26/21
Tuesday, May 25th 2021 over $430 billion was parked at the Fed’s overnight repo facility, a new record.
Over 40 counter parties supposedly parked cash there because of how US and European banks are flush with cash.
Fed Alert: Overnight Reverse Repo Usage Soars Above Covid Crisis Highs www.zerohedge.com/markets/fed…
However, what if the spike in interest rates on the US Treasury yield curve is what is actually causing the repo problems because of how over leveraged hedge funds, family offices and banks are with so many of their trades?
The Fed is going to make another temporary government program permanent.
This time it’s the Fed’s repo facility that will be becoming a permanent repo facility for non-banks like hedge funds, family offices, money market funds, real estate investment trusts and small banks.
Fed Aims to Radically Transform Funding Markets www.bloomberg.com/opinion/art…
Fed Prepares to Go Direct with Liquidity www.theinstitutionalriskanaly…
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Jason Burack is an investor, entrepreneur, financial historian, Austrian School economist, and contrarian. Jason co-founded the startup financial education company Wall St for Main St, LLC, to try to help the people of Main Street by teaching them the knowledge, skills, research methods, and investing expertise of Wall Street. You can also find Jason’s work at his blog website at www.jasonburack.com.