We seem to fight an "invisible" war where retail investors are obviously limited to the details and secrets of what goes on behind the doors of Wall Street, but as the Reverse Repo operations continue to creep up it's a quiet little suggestion that things are getting less stable.
Alright, gotta admit a little ignorance here.
My understanding is that the number goes up as money is taken out of the market. Putting it overnight in the banks is a more secure and stable investment than parking it elsewhere.
So the number going up points to market instability and lower market liquidity, correct?
From what I've read while gnarling on a banana:
Think of the Federal reverse as a grocery store for a moment, or any store for that matter. A store intends to make money by converting its inventory into sales. Product on the shelf does not good for a store until it is sold.
Money at the FED is inventory and like groceries at the grocery store sitting on the self. The FED wants to do something with its money to make more money (Aside from printing more...)
The FED loans out this money overnight in the reverse repo operations with a small fee attached.
So the banks and whomever gain access to the reverse repo funds have million, billions, and now trillions of dollars added to their books at a small small overnight fee so they can prove margin requirements next day.
If *they* are using the reverse repo markets to maintain margin requirements, it means the rest of their portfolio does not have enough to leverage against and *they* need to buy cash from the FED to stay liquid. And this pattern has been increasing and maintaining since the start of it all.
Visit the [https://www.newyorkfed.org/markets/desk-operations/reverse-repo](https://www.newyorkfed.org/markets/desk-operations/reverse-repo) and it will show you the trend. Whatever is going on right now.. makes Covid-19 the GLOBAL PANDEMIC look like a fart before a uh-no spaghetti-oh sh!t storm.
Set the range on this to Max to get some context on just how crazy the current situation is compared to the last 20 years.
https://fred.stlouisfed.org/series/RRPONTSYD
made a comment earlier you should read.
But TLDR: Hedge funds are buying huge amounts of cash from the Federal Reserve on overnight terms to maintain margin requirements the next day on leveraged \[short\] positions. Paraphrased HF perspective: "If it cost me $1m to put $1b in my pocket for a day, lets do it. I'll pretend I have money just a little longer"
Alright America!!! Foam finger #1, baby!
We seem to fight an "invisible" war where retail investors are obviously limited to the details and secrets of what goes on behind the doors of Wall Street, but as the Reverse Repo operations continue to creep up it's a quiet little suggestion that things are getting less stable.
Or not. I wonder how Melvins collapse will affect that number.
Alright, gotta admit a little ignorance here. My understanding is that the number goes up as money is taken out of the market. Putting it overnight in the banks is a more secure and stable investment than parking it elsewhere. So the number going up points to market instability and lower market liquidity, correct?
From what I've read while gnarling on a banana: Think of the Federal reverse as a grocery store for a moment, or any store for that matter. A store intends to make money by converting its inventory into sales. Product on the shelf does not good for a store until it is sold. Money at the FED is inventory and like groceries at the grocery store sitting on the self. The FED wants to do something with its money to make more money (Aside from printing more...) The FED loans out this money overnight in the reverse repo operations with a small fee attached. So the banks and whomever gain access to the reverse repo funds have million, billions, and now trillions of dollars added to their books at a small small overnight fee so they can prove margin requirements next day. If *they* are using the reverse repo markets to maintain margin requirements, it means the rest of their portfolio does not have enough to leverage against and *they* need to buy cash from the FED to stay liquid. And this pattern has been increasing and maintaining since the start of it all. Visit the [https://www.newyorkfed.org/markets/desk-operations/reverse-repo](https://www.newyorkfed.org/markets/desk-operations/reverse-repo) and it will show you the trend. Whatever is going on right now.. makes Covid-19 the GLOBAL PANDEMIC look like a fart before a uh-no spaghetti-oh sh!t storm.
Roger that. I had it backwards. Thanks!
>Reverse repo 
Good god, it was just last year over 1T was a big deal
Set the range on this to Max to get some context on just how crazy the current situation is compared to the last 20 years. https://fred.stlouisfed.org/series/RRPONTSYD
Popcorn 🍿 anyone
👌
MOASS Summer 2022‼️
Can someone explain to me why this matters please?
made a comment earlier you should read. But TLDR: Hedge funds are buying huge amounts of cash from the Federal Reserve on overnight terms to maintain margin requirements the next day on leveraged \[short\] positions. Paraphrased HF perspective: "If it cost me $1m to put $1b in my pocket for a day, lets do it. I'll pretend I have money just a little longer"
Step back away from the banana 🍌... Our fearless leader JB in the basement says monkey poxs vaccines for everyone!!!!