The Fed repo problem is about to blow bigger than when it did in 2008 before GFC, Back then Fed and central banks had money to fix the market (it took 5 years) but now Central banks and Fed already spent most of their ammo. Many international and US are reporting about the FED repo cover up
www.zerohedge.com/ma...ts-market-crash-days
www.zerohedge.com/ma...e-update-repo-fiasco
BIS just released a report on how bad and dangerous Repo market has become. in a nutshell, the four Big Banks in the US refining from lending at Fed 1.75 rate overnight, effectively forcing the Fed to give them 'Not QE'' Money. Fed's FOMC memo hints Fed is holding 2020 q4 QE in case of market crash.
Bank of International Settlements (BIS) reported that the overnight repo problems might stem from the reluctance of the four largest U.S. banks to lend to some of the largest hedge funds. The four banks are being forced to fund a massive surge in U.S. Treasury issuance and therefore reallocated funding from the hedge funds to the U.S. Treasury. Per the Financial Times in Hedge Funds key in exacerbating repo market turmoil, says BIS: “High demand for secured (repo) funding from non-financial institutions, such as hedge funds heavily engaged in leveraging up relative value trades,” – was a key factor behind the chaos, said Claudio Borio, Head of the monetary and economic department at the BIS.
In case you want to profit from coming market crash, you can buy $vix (currently crushed to extreme) or Bear ETFs like SSD.
www.zerohedge.com/ma...ts-market-crash-days
www.zerohedge.com/ma...e-update-repo-fiasco
BIS just released a report on how bad and dangerous Repo market has become. in a nutshell, the four Big Banks in the US refining from lending at Fed 1.75 rate overnight, effectively forcing the Fed to give them 'Not QE'' Money. Fed's FOMC memo hints Fed is holding 2020 q4 QE in case of market crash.
Bank of International Settlements (BIS) reported that the overnight repo problems might stem from the reluctance of the four largest U.S. banks to lend to some of the largest hedge funds. The four banks are being forced to fund a massive surge in U.S. Treasury issuance and therefore reallocated funding from the hedge funds to the U.S. Treasury. Per the Financial Times in Hedge Funds key in exacerbating repo market turmoil, says BIS: “High demand for secured (repo) funding from non-financial institutions, such as hedge funds heavily engaged in leveraging up relative value trades,” – was a key factor behind the chaos, said Claudio Borio, Head of the monetary and economic department at the BIS.
In case you want to profit from coming market crash, you can buy $vix (currently crushed to extreme) or Bear ETFs like SSD.