Announcement

Collapse
No announcement yet.

US - Do US banks have a liquidity problem? Or a "good" collateral shortage? QE4 implemented using repo market as excuse - since September 2019 & now what in 2021?......2022

Collapse
X
 
  • Filter
  • Time
  • Show
Clear All
new posts

  • #16
    So what if China is selling off their large holding of US treasuries to raise cash and the US gov told US banks to buy treasuries to absorb the effect? This would diminish the US banks available cash for the repo market and - gee...the fed would have to step in to support the repo market.

    Why the need for this "massive" amount of financial support of the repo markets by the fed? Why now? Why potentially create such a huge balloon effect in the US stock market as a consequence of repo operations?

    We do not warn only about disease outbreaks on this site. Economic downturns and subsequent job instability are a health threat.




    OPERATING POLICY

    Statement Regarding Repurchase Operations
    December 12, 2019

    The Open Market Trading Desk (the Desk) at the Federal Reserve Bank of New York has released the schedule of repurchase agreement (repo) operations for the monthly period from December 13, 2019 through January 14, 2020. In accordance with the most recent FOMC directive, the Desk will conduct repo operations to ensure that the supply of reserves remains ample and to mitigate the risk of money market pressures around year end that could adversely affect policy implementation.

    The Desk will continue to offer two-week term repo operations twice per week, four of which span year end. In addition, the Desk will also offer another longer-maturity term repo operation that spans year end. The amount offered in this operation will be at least $50 billion.

    Overnight repo operations will continue to be held each day. On December 31, 2019 and January 2, 2020, the overnight repo offering will increase to at least $150 billion. In addition, on December 30, 2019, the Desk will offer a $75 billion repo that settles on December 31, 2019 and matures on January 2, 2020.

    The Desk intends to adjust the timing and amounts of repo operations as needed to mitigate the risk of money market pressures that could adversely affect policy implementation, consistent with the directive from the FOMC.

    Detailed information on the schedule and parameters of term and overnight repurchase agreement operations are provided on the Repurchase Agreement Operational Details site.



    Comment


    • #17
      Deal Date: Monday, December 16, 2019
      Delivery Date: Monday, December 16, 2019
      Maturity Date: Tuesday, December 17, 2019
      Type of Operation: Repo
      Auction Method: Multiple Price
      Settlement: Same Day
      Term of Operation - Calendar Days : 1 Day
      Term of Operation - Business Days : 1 Day
      Operation Close Time: 08:45 AM



      Results Amount ($B) Rate (%)
      Collateral Type Submitted Accepted Stop-Out1 Weighted
      Average2
      High Low
      Treasury 23.500 23.500 1.55 1.550 1.55 1.55
      Agency 1.000 1.000 1.55 1.550 1.55 1.55
      Mortgage-backed 11.900 11.900 1.55 1.550 1.55 1.55
      Total 36.400 36.400

      Deal Date: Monday, December 16, 2019
      Delivery Date: Monday, December 16, 2019
      Maturity Date: Friday, January 17, 2020
      Type of Operation: Repo
      Auction Method: Multiple Price
      Settlement: Same Day
      Term of Operation - Calendar Days : 32 Days
      Term of Operation - Business Days : 22 Days
      Operation Close Time: 08:15 AM



      Results Amount ($B) Rate (%)
      Collateral Type Submitted Accepted Stop-Out1 Weighted
      Average2
      High Low
      Treasury 29.850 28.759 1.56 1.576 1.60 1.56
      Agency .000 .000 N/A N/A N/A N/A
      Mortgage-backed 24.400 21.241 1.58 1.604 1.64 1.56
      Total 54.250 50.000

      Comment


      • #18
        The US fed injected 221 Billion net in the repo market this week.


        Comment


        • #19

          Please see:


          China reduced its holdings of U.S. Treasuries for the fourth consecutive month - December 17, 2019

          "Foreign holders slightly reduced their holdings of US Treasury bonds by US $ 1.6 billion in October.

          Since 2019, China's holdings of U.S. Treasury bonds have not increased significantly."


          One reason why the fed probably started to fund the repo market. Banks being required to buy US treasuries (debt)? that lowers their available cash - until the fed swaps for cash in the repo market daily.


          How can the fed unwind this situation?

          Comment


          • #20
            Today's repo tally 57.75 Billion:

            Deal Date: Monday, December 30, 2019
            Delivery Date: Tuesday, December 31, 2019
            Maturity Date: Thursday, January 02, 2020
            Type of Operation: Repo
            Auction Method: Multiple Price
            Settlement: 1 Day Forward
            Term of Operation - Calendar Days : 2 Days
            Term of Operation - Business Days : 1 Day
            Operation Close Time: 10:15 AM



            Results Amount ($B) Rate (%)
            Collateral Type Submitted Accepted Stop-Out1 Weighted
            Average2
            High Low
            Treasury 7.400 7.400 1.55 1.550 1.55 1.55
            Agency .000 .000 N/A N/A N/A N/A
            Mortgage-backed 11.250 11.250 1.55 1.557 1.56 1.55
            Total 18.650 18.650

            Deal Date: Monday, December 30, 2019
            Delivery Date: Monday, December 30, 2019
            Maturity Date: Tuesday, December 31, 2019
            Type of Operation: Repo
            Auction Method: Multiple Price
            Settlement: Same Day
            Term of Operation - Calendar Days : 1 Day
            Term of Operation - Business Days : 1 Day
            Operation Close Time: 08:45 AM



            Results Amount ($B) Rate (%)
            Collateral Type Submitted Accepted Stop-Out1 Weighted
            Average2
            High Low
            Treasury 15.500 15.500 1.55 1.550 1.55 1.55
            Agency .000 .000 N/A N/A N/A N/A
            Mortgage-backed 15.300 15.300 1.55 1.550 1.55 1.55
            Total 30.800 30.800

            Deal Date: Monday, December 30, 2019
            Delivery Date: Monday, December 30, 2019
            Maturity Date: Tuesday, January 14, 2020
            Type of Operation: Repo
            Auction Method: Multiple Price
            Settlement: Same Day
            Term of Operation - Calendar Days : 15 Days
            Term of Operation - Business Days : 10 Days
            Operation Close Time: 08:15 AM



            Results Amount ($B) Rate (%)
            Collateral Type Submitted Accepted Stop-Out1 Weighted
            Average2
            High Low
            Treasury 6.050 6.050 1.56 1.570 1.57 1.56
            Agency .000 .000 N/A N/A N/A N/A
            Mortgage-backed 2.250 2.250 1.56 1.562 1.58 1.56
            Total 8.300 8.300


            Comment


            • #21
              It is the Roaring 20s Again - A New Generation!!!

              The US Fed supported the repo market with 80.3 Billion in the 1st 2 business days of 2020.

              Print that money!


              Comment


              • #22
                snip

                Indeed, something appears amiss, because as Curvature Securities' Scott Skyrm writes in his daily Repo Market Commentary note, the total overnight and term Fed RP operations on Friday were greater than on year end! On year-end, the Fed had pumped a total of $255.95 billion into the market verses $258.9 billion on Friday.

                Comment


                • #23
                  Print, print, print, print


                  https://www.federalreserve.gov/monet...centtrends.htm


                  Click image for larger version  Name:	febbalancegraph.PNG Views:	0 Size:	48.5 KB ID:	829295

                  Comment


                  • #24
                    • "Central banks use reverse repos to add money to the money supply via open market operations."
                    https://www.investopedia.com/terms/r...t%20operations


                    Apparently last night's reverse repo operation was the largest since 2017. Is the fed "churning"? Continuous debt rollovers?



                    Deal Date: Wednesday, May 19, 2021
                    Delivery Date: Wednesday, May 19, 2021
                    Maturity Date: Thursday, May 20, 2021
                    Type of Operation: Reverse Repo
                    Auction Method: Fixed-Rate
                    Settlement: Same Day
                    Term of Operation - Calendar Days : 1 Day
                    Term of Operation - Business Days : 1 Day
                    Operation Close Time: 01:15 PM
                    Participating Counterparties: 43
                    Accepted Counterparties: 43



                    Results Amount ($B) Rate (%)
                    Collateral Type Submitted Accepted Award3 High Low
                    Treasury 293.998 293.998 0.00 N/A N/A

                    Comment


                    • #25
                      Deal Date: Thursday, May 20, 2021
                      Delivery Date: Thursday, May 20, 2021
                      Maturity Date: Friday, May 21, 2021
                      Type of Operation: Reverse Repo
                      Auction Method: Fixed-Rate
                      Settlement: Same Day
                      Term of Operation - Calendar Days : 1 Day
                      Term of Operation - Business Days : 1 Day
                      Operation Close Time: 01:15 PM
                      Participating Counterparties: 48
                      Accepted Counterparties: 48


                      Results Amount ($B) Rate (%)
                      Collateral Type Submitted Accepted Award3 High Low
                      Treasury 351.121 351.121 0.00 N/A N/A
                      Top


                      Comment


                      • #26
                        And more...


                        Deal Date: Monday, May 24, 2021
                        Delivery Date: Monday, May 24, 2021
                        Maturity Date: Tuesday, May 25, 2021
                        Type of Operation: Reverse Repo
                        Auction Method: Fixed-Rate
                        Settlement: Same Day
                        Term of Operation - Calendar Days : 1 Day
                        Term of Operation - Business Days : 1 Day
                        Operation Close Time: 01:15 PM
                        Participating Counterparties: 54
                        Accepted Counterparties: 54



                        Results Amount ($B) Rate (%)
                        Collateral Type Submitted Accepted Award3 High Low
                        Treasury 394.941 394.941 0.00 N/A N/A

                        Comment


                        • #27
                          bump this

                          Comment


                          • #28



                            Deal Date: Tuesday, May 25, 2021
                            Delivery Date: Tuesday, May 25, 2021
                            Maturity Date: Wednesday, May 26, 2021
                            Type of Operation: Reverse Repo
                            Auction Method: Fixed-Rate
                            Settlement: Same Day
                            Term of Operation - Calendar Days : 1 Day
                            Term of Operation - Business Days : 1 Day
                            Operation Close Time: 01:15 PM
                            Participating Counterparties: 48
                            Accepted Counterparties: 48



                            Results Amount ($B) Rate (%)
                            Collateral Type Submitted Accepted Award3 High Low
                            Treasury 432.955 432.955 0.00 N/A N/A


                            Comment


                            • #29
                              Is this like writing new bad checks to cover yesterday's bad checks?

                              Comment


                              • #30
                                Yup...it takes more and more....




                                Deal Date: Wednesday, May 26, 2021
                                Delivery Date: Wednesday, May 26, 2021
                                Maturity Date: Thursday, May 27, 2021
                                Type of Operation: Reverse Repo
                                Auction Method: Fixed-Rate
                                Settlement: Same Day
                                Term of Operation - Calendar Days : 1 Day
                                Term of Operation - Business Days : 1 Day
                                Operation Close Time: 01:15 PM
                                Participating Counterparties: 46
                                Accepted Counterparties: 46



                                Results Amount ($B) Rate (%)
                                Collateral Type Submitted Accepted Award3 High Low
                                Treasury 450.283 450.283 0.00 N/A N/A


                                Comment

                                Working...
                                X