US FED Injects $13.5B in Liquidity Overnight as QT Ends, Bitcoin & MSTR React \ stacker news ~econ

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US FED Injects $13.5B in Liquidity Overnight as QT Ends, Bitcoin & MSTR React finance.yahoo.com/news/us-fed-injects-13-5b-104021736.html

1039 sats \ 20 comments \ @Scoresby 2 Dec econ

The US Federal Reserve (FED) injected $13.5 billion into the banking system through overnight repurchase agreements as quantitative tightening (QT) ended on Monday. This marks the second-largest liquidity injection since the Covid pandemic, triggering trading actions in Bitcoin and MSTR stock.

The massive liquidity injection is one of the largest in recent years, marking the second-biggest liquidity injection since 2020 and even exceeding the Dot Com Bubble in the early 2000s, according to Barchart.

Notably, this follows another $25 billion in liquidity injection in the morning repo operation. The collateral included $12.5 billion in treasuries and $12.5 billion in mortgage-backed securities.

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202 sats \ 9 replies \ @SimpleStacker 2 Dec

Why was this needed...?

600 sats \ 7 replies \ @Scoresby OP 2 Dec

102 sats \ 1 reply \ @nitter 2 Dec

I'm back to haunt you in your dreams, @Scoresby! 👻

0 sats \ 0 replies \ @Scoresby OP 2 Dec

hooray! I'm zapping you just cause I like you.

102 sats \ 3 replies \ @SimpleStacker 2 Dec

sigh, so it looks like i will have to devote some real brainpower and time to try and understand this after all

105 sats \ 1 reply \ @Scoresby OP 2 Dec

This was also an okay explanation:

0 sats \ 0 replies \ @nitter 2 Dec

https://xcancel.com/infraa_/status/1995905055443288136

100 sats \ 0 replies \ @Scoresby OP 2 Dec

yeah, I thought it was just some scammy people baiting for clicks, but after reading a few more articles about it...something's going on. The Market Watch article I linked to in another comment has some good links.

100 sats \ 0 replies \ @nitter 2 Dec

https://xcancel.com/LynAldenContact/status/1985353545865105847

102 sats \ 0 replies \ @optimism 2 Dec

I think because of the SOFR-IORB Spread indicator

but I cannot reproduce this chart from FRED data which could either be a skill deficit on my end, or something else... so I'm not sure if this is it.

102 sats \ 0 replies \ @BlokchainB 3 Dec

Well that was fast

102 sats \ 1 reply \ @SevenOfNine 2 Dec

What is even happening?

10 sats \ 0 replies \ @Scoresby OP 2 Dec

#1299849

100 sats \ 1 reply \ @Scoresby OP 2 Dec

This Market Watch article has a little analysis (although it is maybe a little too breathless):

The Fed’s overnight reverse repo facility once held about $2.5 trillion in spare cash, like a giant mattress stuffed with money nobody needed yet. That mattress is empty. The cash migrated into your money-market fund, which means you are now the mattress.

Then there’s the Standing Repo Facility. That’s the Fed’s emergency lending window. The backstop they said they’d “hardly ever use.” The facility that lets big dealers hand over Treasurys and get overnight cash at a preset rate. It’s the central bank’s credit card for when things get weird.

It’s been getting real weird.

Some days, dealers have borrowed up to $10 billion from the facility. Used to be that this was a quarterly thing. Now it’s Tuesday.

102 sats \ 0 replies \ @optimism 2 Dec

Nice article (had to click it to check if they really said "things get weird", lol)

Here’s the tell: Private repo rates are printing above the Fed’s own ceiling on this facility. Which means the system is so tight that people are actually paying more to borrow in private markets than the Fed’s supposed “emergency” rate. That’s not a technical adjustment. That’s a failure of monetary control. That’s the Fed admitting it can’t actually set the price of money anymore. The market is doing it for them.

That means that the thing I posted about SOFR-IORB is actually correct, yey. lol

5 sats \ 2 replies \ @Solomonsatoshi 3 Dec

The US industrial military banking complex is facing imminent insolvency.

USA has lost the trade war- USA cannot make much anymore...except more debt.

USA cannot fight a war of any magnitude for the next ten years without China allowing the supply of refined rare earths required for most modern military hardware.

Game over Uncle Sam?

102 sats \ 1 reply \ @itsrealfake 3 Dec

this just in: 10 years of psyops

5 sats \ 0 replies \ @Solomonsatoshi 3 Dec

The formerly wealthy western industrial economies cannot compete with Chinas deliberately structured highly competitive mixed economy model. Use all the financial engineering you like, lowering the cost of fiat debt capital since 1990...the structure of your neoliberalised economies is inherently not as competitive as Chinas. The neoliberalised west has squandered its legacy financial advantage by allowing vast sums of fiat debt capital to be issued toward inflating the price of existing assets- mostly real estate- which only created a short term illusion of wealth while depriving the productive sectors of the economy of much needed investment and maintenance. The problem became chronic and self fulfilling because Chinas mixed economy could already demonstrably make things more efficiently and so all the investment in making things went to China. China has deliberately provided state investment in core supply chains that will drive and incentivise the competitive sectors. China directed most fiat debt capital toward productive infrastructure. Electricity drives the modern industrial and post industrial economy and China produces much more of it far cheaper than any other industrialised economy.

This makes Chinas manufacturers more competitive than the wests and so the wests industrial base has been shrinking for several decades.

The west cannot now make most things - certainly not at a competitive price. The USA cannot now fight a war of any size without the supply of rare earths that China controls. The west has lost the trade war and has now lost its military advantage. Game over western civilisation? The Libertarian neoliberals will be determined in their denial of reality...but they cannot credibly refute it.

0 sats \ 0 replies \ @miraclemarc 3 Dec

Nothing stops this train.

0 sats \ 0 replies \ @brent 3 Dec

GAME ON!