Sunday , October 13 2019
Home / David Stockman's Contra Corner / Be Very Afraid: $1.4 Trillion Of Excess Bank Reserves And 10% Repo Don’t Compute

Be Very Afraid: $1.4 Trillion Of Excess Bank Reserves And 10% Repo Don’t Compute

Summary:
Yet while the book has yet to be written on the causes for last week's shocking move higher in repo rates, which sent general collateral as high as 10%, a record print in a time of .4 trillion in excess reserves, we can shed some clarity on the definition of "reserves." While there is a universe of semantic gymnastics when it comes to explaining what reserves are, the  most basic definition is quite simply "cash", however not cash in circulation but rather cash (and deposits) held in the bank's account with the Federal Reserve (which the US central bank's name comes from). https://www.zerohedge.com/markets/these-are-banks-where-feds-14-trillion-reserves-are-parked

Topics:
David Stockman considers the following as important:

This could be interesting, too:

David Stockman writes The Beginning Of The End—For Wall Street And The Donald, Too

David Stockman writes Pivoting Powell’s Pathetic Attempt At Double-Speak: QE By Any Other Name

David Stockman writes The Donald’s Swiss Cheese Tariff Walls Are Bringing Boom Times To The K-Street Lobbies

David Stockman writes Apex Before The Storm

Yet while the book has yet to be written on the causes for last week's shocking move higher in repo rates, which sent general collateral as high as 10%, a record print in a time of $1.4 trillion in excess reserves, we can shed some clarity on the definition of "reserves." While there is a universe of semantic gymnastics when it comes to explaining what reserves are, the  most basic definition is quite simply "cash", however not cash in circulation but rather cash (and deposits) held in the bank's account with the Federal Reserve (which the US central bank's name comes from).

https://www.zerohedge.com/markets/these-are-banks-where-feds-14-trillion-reserves-are-parked

David Stockman
David Alan Stockman (born November 10, 1946) is a former businessman and U.S. politician who served as a Republican U.S. Representative from the state of Michigan (1977–1981) and as the Director of the Office of Management and Budget (1981–1985) under President Ronald Reagan.

Leave a Reply

Your email address will not be published. Required fields are marked *