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

Sharing is Caring!

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 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 ! 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

Leave a Comment

This site uses Akismet to reduce spam. Learn how your comment data is processed.