Recent repo spikes are warning of another Crisis, but not a guarantee of one. Markets are becoming illiquid.

via :

Despite FOMC rate cut in
September, policy needs
to focus far more on
balance sheet expansion,
i.e. QE. This will push
bond term premia higher.act@liquidity.com for report

EM liquidity slumps again in August despite strong rebound in Global Liquidity data
Cross-border capital flows weaken widely across China and Other EM with US$89 billion quitting in August..Em Squeezed !
act@liquidity.com for reports at special price in sept

Another Financial Crisis? The US Repo’s Big Reverberations

  • FOMC cuts rates 25bp in September and hints at more QE
  • Policy-makers appear willing to do more, but dissent growing inside Fed
  • Recent repo rate spikes do not portend another 2007/08, but they are a warning
  • Fed (and other Central Banks) need to massively expand their balance sheets
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