Posted on 12/29/2023 11:17:33 AM PST by Kaiser8408a
Hey Joe (BIDEN)! Please stop destroying the economy!! (Here is my favorite version by Jim Pons and The Leaves!). The most lame version? The Byrds and David Crosby.
Over a month ago (and well before the Fed’s “shocking” dovish pivot) as the Fed’s Overnight Reverse Repo tumbled below $900 billion for the first time since June 2021 amid a growing debate of where and when the Fed’s reserve scarcity constraint will be hit, we warned that liquidity is rapidly approaching the reverse repo constraint level which could emerge as soon as the RRP facility dropped to $700 billion, at which point the market’s all-important credit plumbing will start to crack.
We didn’t have long to wait because just a few days later, on December 1 (just after the customary month-end window dressing period) when reverse repo tumbled to a fresh multi-year low of $765 billion…
Indeed, one can already see traces of this in the repo market, where the rate on overnight GC repo first surged to 5.625% at the open on the final trading day of December before dropping to 5.45%, according to ICAP. It has since climbed back to 5.50%. But that’s still lower than where repo rates for Dec. 29 were trading during the prior session, as markets now start frontrunning the coming reverse repo liquidity flood.
Of course, once reverse repo eventually tumbles to $0 some time in March, all bets are off and the narrative shift to the next QE will begin.
(Excerpt) Read more at confoundedinterest.net ...
By the way, they are where they were in June of 2021. And at the time, that was the highest in history. Before March of 2021 they were, compared to recent rates, virtually non existent.
Reverse repos: https://fred.stlouisfed.org/series/RRPONTSYD
But that doesn't stop hucksters from telling ignorant people that it's a terrible thing. And generating the same ignorant comments.
The STATE OF THE UNION SPEECH will be interesting..............
Yet another drinking game - first to numb the stupid, and second - drink every tine Biden tells a lie... so you will be drunk within the first 5 minutes...
The important element of all of this is very boring—short term money market and repo interest rates have remained about the same for the last few months.
The only reason this matters at all is that almost all “talking heads”, .gov and private, are claiming that interest rates will be dropping significantly in 2024.
They are not putting their money where their mouth is.
What does this mean?
My eyes glaze over reading about economics, so my irrelevant comment is just about his musical tastes. Yes the Leaves version of Hey Joe was pretty good and the Byrds version was without a doubt, the worst ever.And this is coming from a huge Byrds fan.
Other good versions are the original by Billy Roberts, Jimi Hendrix, Tim Rose, and Otis Taylor.
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