REPO Market

[Anonymous No.16804996]

>wtf is happening?

[Anonymous No.16805016]

>>16804996
>he doesn't know

it's coming, not long now...

[Anonymous No.16805031]

>$100,000,000 Tether has been minted at treasury

[Anonymous No.16805035]

>>16804996
At this point (((they))) are not even consuming fancy paper to make monnies.
They just push sone buttons.
Welcome to the future,anon.
We golden bull for the next 1k years.

[Anonymous No.16805041]

Explain to a 85 IQ man. Is this because Trump has been pumping money to prevent a recession? When next recession?

[Anonymous No.16805202]

>>16804996
what is the repo market

[Anonymous No.16805218]

>>16805041
Onions boi detected. TDS level 10.
Anon, the goal of the previous 10 administrations was to destroy America. The Federal Reserve is not a branch of the government. They are kikes.

[Anonymous No.16805257]

>>16804996
It means that banks (or whoever is doing the repos) are economically uncertain about the future.

The short-term spike is possibly because of Iran. I'm not sure.

[Anonymous No.16805272]

>>16805041
large banks either don't trust each other enough, or simply don't have enough money to loan each other at the end of every day, so the FED has to step in.

[Anonymous No.16805278]

(((The Fed))) has been repurchasing bad assets, generally loans or bonds, from banks in exchange for USD.
The idea is that banks will have more money available to loan to people so that will stimulate further economic growth, which on wall street it will. In the real world we're fucked.

[Anonymous No.16805291]

>>16805202
Overnight rates for government securities.

[Anonymous No.16805294]

>>16805041
The institution with that power is the federal reserve, no branch of govt can enact monetary policy.

[Anonymous No.16805429]

>>16805272
>large banks either don't trust each other enough, or simply don't have enough money to loan each other at the end of every day, so the FED has to step in.
the graphic shows an increase in repo activities

[Anonymous No.16805565]

>>16804996
Someone already posted this explanation here in the past, I'll just repeat:

It's the effect of supply and demand. Either demand for REPO loans is high, which means banks' financial assets are collapsing at an alarming rate, or banks dont want to lend one to the other anymore, because they fear everyone is too risky at this point.

Or.... there could be a third expanation. Big banks such as JPMorgan could be avoiding lend on the REPO market at the same time spreading fear to Wall Street, in order for the FED to be worried enough to help big banks, buying their bad assets, while leaving small banks to bankruptcy. This would force many small banks out of the market, decreasing competition.

[Anonymous No.16805647]

>>16804996
I read it Pedo market. Thanks to /pol

[Anonymous No.16805674]

>>16805565
>Either demand for REPO loans is high, which means banks' financial assets are collapsing at an alarming rate
i don't understand the cause-effect behind this could you explain to a braindead primate?

[Anonymous No.16805723]

>>16805429
That's not what the graph shows. The graph shows an increase in the overnight funding rate, one of the things that could raise that rate is a decrease in volume meaning less cash to meet needs, increased volume alone would not raise the rate. If you look lending volume actually did drop off a cliff when the rates spiked.

[Anonymous No.16805743]

>>16805674
If loans or other securities are defaulting then that will reduce income expected from those instruments, increasing a businesses immediate need for cash to settle.

[Anonymous No.16805797]

>>16805674
Banks work leveraged. If they have 1mi USD they lend between 3mi to 10mi, depending on the country they are. When their investments make profit, they dont need to use the REPO market, but when people are defaulting the loans, the banks need to ask for loans on the REPO market in order to end the day without being insolvent. When most banks do this at the same time, there is no money for everyone, then interest spikes.

[Anonymous No.16805859]

>>16805797
It's not about defaulting, it's about maturity adjusted income. They ask for loans to smooth income not to cover defaults.

[Anonymous No.16806032]

they fixed that already

[Anonymous No.16806055]

>>16806032
no if that was the case they would end the repo operations

[Anonymous No.16806063]

you're literally a knuckle dragging retard if you think this matters and will stop the rally

[Anonymous No.16806082]

honestly even caring about this is like eating at a 5 start restaurant and then hearing a plate break and rushing into the kitchen to try to make sure everything is okay. you just look like an ass. let the professionals handle it, it's fucking nothing to get worried about. just sit back and enjoy the scheduled gains and stop asking questions

[Anonymous No.16806099]

>>16806063
Kekew, you ok there Jerome? Sounds like cope to me

[Anonymous No.16806102]

By the way, peter schiff is right

[Anonymous No.16806129]

>>16806082
>just stop asking questions

You can't interconnect and min-max every part of the financial system then tell people to "go to sleep goyim" when parts of it are not functioning properly. Stupid, I dont think its us who are the mouth breathers.

[Anonymous No.16806141]

>>16806082
>nothing to see here goy

[Anonymous No.16806171]

>>16806082
why are you shilling for the fed on biz? try tw@er

[Anonymous No.16806199]

>>16804996
>>16805797
>>16805565
The thing is how long can the printing + lowering rates can keep the boat afloat? I was planning on a recession in US/EU with a start ranging from sept 2019 to sept 2020 according to the yield curve spreads which never lie but now I'm uncertain with all this unprecedented bullshit "NOT QE BTW", plus the rates can still be lowered to 0 before shit really hits the fan.

>>16806082
ok Jerome let the big boys talk now

[Anonymous No.16806212]

>>16806082
Anyone else feeling sleepy?

[Anonymous No.16806249]

>>16804996

[Anonymous No.16806290]

>>16805291
>Government securities
Isnt the repo market comprised of securities of all sorts? Like asset backed securities (mortgages, auto loans etc.) Or am I confused?

[Anonymous No.16806304]

>>16806290
Yeah it is. Government securities make up the majority of the volume though

[Anonymous No.16806346]

>>16806102

This boomer said 2013 when gold was rallying that it will go 5000 per oz lmao. Nowadays gold seems better option than then but man he is a fucking retard. Anything he says is just his own opinion, nothing is backed by anything.

[Anonymous No.16806484]

>>16806304
Where can I find a breakdown of what securities these banks are trading overnight?

[Anonymous No.16806669]

>>16806082
Fuck off you retarded good goy

[Anonymous No.16806701]

>>16806484
https://www.newyorkfed.org/data-and-statistics/data-visualization/tri-party-repo#interactive/tripartygcf

I couldn't say where information on what the non-mbs trading specifically is. Mostly corporate debt I would guess. There is also the foreign repo and a bunch of private balance sheets that don't feed into this.

[Anonymous No.16806733]

>Moron Repo thread full of morons
into the trash it goes

[Anonymous No.16806835]

>>16806733
enlighten us with your wisdom

[Anonymous No.16806872]

>>16805723
>The graph shows an increase in the overnight funding rate
so is this ''FUNDING RATE'' really different from the meaning one could think?
When you say ''funding rate'' I think of an increase in volume activities.
What is this funding rate?
>>16805797
>>16805743
basically people are not paying bac their loans to the jews?
But the graph OP posted show less REPO activity.. so confused

[Anonymous No.16806883]

>>16805041
I'll give it to you like you are in 3rd grade; THERE IS. NO. MONEY. No liquidity. The government has been printing BILLIONS for years but that money goes straight to banks who then either hoard it or siphon it off to their personal offshore accounts. THAT MONEY DOES NOT TOUCH THE PUBLIC. IT DOES NOT TRICKLE DOWN. Hence, at some day closes, banks do not have enough money to lend to each other, so they have to pick up interest rates. Interest rates are high when there is uncertainty (use of yourself as an example, if you have a shit credit score a bank will not trust you and make you pay higher % on your debt, but if you are an established good debtor, then you will get a lower interest rate on debt). Banks see they are low on cash, they want to make it worth their while to lend out, hence % rates go up. The fed then steps in and literally throws money at these financial institutions to keep the rates artificially low. The key take away here - THERE IS. NO. MONEY. IN. THE. REAL. ECONOMY. But they will keep printing it anyway and it will continue to conglomerate at the very top - the rich will get far richer and the poor will stay the same, but of course get poorer comparatively as a result (fucking fractions how do they work).

Anon. Buy bitcoin.

[Anonymous No.16806942]

>>16806872
When you think funding rate you should think risk premium really, that's all a funding rate is. Risk of inflation, plus credit risk, plus risk of income/default among others. When the funding rate increases that is because one of those things had increased. If volume increases that means there is more money to be lent out, so lenders would be willing to lend at a lower rate if it means all their money could be productive instead of just sitting around. When there is less volume/money, then an entity may not be able to secure enough cash from the market place if it needs it, so it's credit risk has risen.

>>16806872
We don't and can't know for sure. The fed wont tell people the specifics of why they are lending money. But if people didn't pay back their loans and defaulted it might raise the rates yes.

[Anonymous No.16806960]

>>16804996
I hope you're all doing your part to crash the market, never pay your student loans, put that money in crypto

[Anonymous No.16806988]

>>16806883
Wrong.

They borrow at the overnight rate to service margin calls for swap agreements. These swaps are affected by the markets performance and when trump or china tweets about the trade war the required collateral to stay in the money goes berserk because the market went berserk.

[Anonymous No.16807030]

>>16806032
>they fixed that already
how?

[Anonymous No.16807031]

>>16806988
Yup. This is their operating cost. It's not only swaps, but that's a big portion especially for insurance. That's why it's maturity adjusted. If you have 300 million in treasuries that mature in 3 years but no cash, why should you be penalized more then a few basis points really is the thinking behind the system.

[Anonymous No.16807039]

>>16806988
>It's Trump's fault for tweeting
Why are the banks keeping their margins so tight that a mere tweet sends them crying to the Fed to meet their obligations?

[Anonymous No.16807040]

>>16805859
>it's about maturity adjusted income. They ask for loans to smooth income not to cover defaults?
>>16806199
>The thing is how long can the printing + lowering rates can keep the boat afloat?
maybedefaults.
so it's only to do more money not to cover?
maybe forever since the fed can print ethernally and the money goes all in the bonds

[Anonymous No.16807078]

>>16807030
by establishing a standing repo facility. this is no big deal at all and not qe. the fed is just acting on their mandate to maintain price stability and their goal of full employment. their asymmetric inflation target of 2% is not even currently being met, with inflation slightly below this number. with negative interest rates in the eurozone and tepid global growth, the robust US economy risks being dragged down somewhat, but will remain strong fundamentally.

[Anonymous No.16807097]

>>16807040
Technically yes. It might be defaults sure, but what repo is used for almost exclusively is covering operating. Margins, deposits, and required reserves.

[Anonymous No.16807136]

>>16805041
>Is this because Trump has been pumping money to prevent a recession?
Trump can't do that. In fact congress can't tell the federal reserve what to do at all.
They're just being autistic. Australia has not used QE since the 80s.

[Anonymous No.16807140]

>>16806304
>Government securities
what are these? Bonds?

[Anonymous No.16807155]

>>16807140
Thats one type of security

[Anonymous No.16807165]

>>16807078
Systematic risk isn't really systematic if it doesn't effect everyone involved at some point. Euro is probably fucked, and corporations probably binged on debt thinking the music had stopped already. Half a trillion is an insane amount of liquidty, even if we aren't using all of it.

Also,
>not QE
Fuck OFF JEROME

[Anonymous No.16807185]

>>16804996
https://m.youtube.com/watch?v=OM71gQmrLks

[Anonymous No.16807207]

>>16807185
if this is your channel, you should make anti-communism videos

[Anonymous No.16807300]

>>16807185
Is this your video? I really like it and your viewpoints, I think we have similar understanding. Send me your discord or telegram

[Anonymous No.16807733]

>>16807185
I agree with how they dealt with the housing market crisis was wrong. Banks should not have been bailed out and let off the hook. There should be a huge investigation into big banks.

[Anonymous No.16807740]

>>16804996
shh we are not supposed to talk about this

look at IRAN

[Anonymous No.16808080]

>>16805272
This

[Anonymous No.16808595]

>>16807078
How does QE differ from repo market injections?

QE: Federal reserve makes purchases of US treasury bills from investment banks

Repo injection: Federal reserve injects money to increase liquidity in repo market (what is that money used to purchase? what asset/who is on the other side of this transaction??)

[Anonymous No.16808679]

>>16806883
This is correct in terms of money inequality prevents inflation and hilarious disparity

[Anonymous No.16808717]

Can't you still buy the United States national dollars in exchange for your Fed Dollars? Is that legit or some sovereign citizen meme?

[Anonymous No.16808727]

>>16807039
>why does news impact the value of bundled securities

[Anonymous No.16808741]

>>16805294
>tfw you will never have a tea party with hitler

[Anonymous No.16809523]

>>16808741
Good - I have a rule against taking tea with unibollocked manlets

[Anonymous No.16809936]

>>16808741
the pictures from that gathering look so comfy. reminds me of my grandmas house

[Anonymous No.16809976]

>>16806988
Wrong
>>16806883
Woke
ECB is desperate, they are trying to inject liquidity in the real economy because M1 is not growing and GDP as well
they are even thinking about helicopter money or MMT
real economy is fucked up yet S&P500 is at ATH
they throw trillions of liquidity in the system and they all ended up there, cause banks are struggling with low interest rates and they are searching for some profits to stay alive, meanwhile middle class is shrinking and they are not borrowing money anymore

[Anonymous No.16810003]

>>16805041
Alright nigger put on your tard helmet because this is the only time anyone will ever explain this to you in a way you can understand.
Banks almost never actually have enough money that if all their customers needed to withdraw their cash the banks could afford it. Even with fractional reserve banking, there's just too much tied up in illiquid investments. When you give your money to a bank they're not just sitting on it, they're investing it with the goal of turning it into more money, that's why your account earns interest.
But, banks are required to keep a certain amount of cash on hand at the end of each day so that they can put up the facade of being able to pay back at least some of their depositors if all of them came crying at once.
So what do you do if you're a bank and you want to invest as much money as possible while also meeting the liquidity (or in tard speak 'cash on hand') requirements the govt wants you to meet at the end of every day?
Well what you do is go to another bank and say, "Hey bank 2, bank 1 here. If you buy these bonds from me at $1 a piece, I guarantee I'll buy them back from you first thing tomorrow morning for $1.01 a piece."
It's a great deal for the other bank, pretty much a guaranteed return so long as you don't go out of business. These kind of deals are what we call the 'Overnight Repo market' or just Repo for short.
So given that these are probably some of the surest investments in the entire market, what would it mean if all of a sudden the banks couldn't sell their stuff into the repo market?
Well first it would mean that every bank was in danger of being in violation of the govt liquidity/CoH rules. But more importantly it means that either the other banks don't trust that the banks selling them repo contracts will be able to buy back their own stuff 24 hours later, or that literally nobody has any money to buy what are basically the single most surefire investment vehicles in the entire world.

[Anonymous No.16810742]

>>16810003
this or what >>16807185 says in the video, ie big banks strong arming the FED

what a clusterfuck

[Anonymous No.16811308]

>>16809976
Shut up you fucking fag

[Anonymous No.16811382]

>>16805041
>https://www.armstrongeconomics.com/markets-by-sector/interest-rates/understand-what-is-the-repo-market/

[Anonymous No.16811385]

>>16804996
Wait. When did the 2nd spike happen?

[Anonymous No.16812338]

>>16811385
It’s happening as we speak...

[Anonymous No.16812401]

Repo will be fixed by the FED. New ATH next week. Stop fudding. Peter Schiff is a doomed for ages like nourel roubini and the fucks at zerohedge. If you follow their advice you have to have real deep pockets.

[Anonymous No.16812460]

>>16808595
>How does QE differ from repo market injections?
because one is QE, but the other one is not QE

[Anonymous No.16813132]

>>16812338
As in today? Or you mean it’s been ongoing? I know that, and I know there was that first spike to 10% in like October last year or something, didn’t hear about anything today though