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While the Fed’s current tightening is not exactly a well-kept secret, stock and bond markets seem willing to ignore what the Fed’s left hand is taking away as the right hand is giving. Reverse repurchase agreements, which I have been tracking here, have exploded to a trillion dollars in money that the Fed is sucking out of the financial system. According to John Mason at Seeking Alpha, total reverse repos on the Fed’s balance sheet actually just hit $1.26 trillion this past week: Factors Affecting Reserve Balances of Depository institutions and Condition Statement of Federal Reserve Banks) had increased by $847.0 billion. This past week, the Fed added an additional $205.0 billion more in reverse repos to the account, ....
Inflation Rises Faster than the Fed Expected, Giving Fed Less Time Than it Needs – Investment Watch investmentwatchblog.com - get the latest breaking news, showbiz & celebrity photos, sport news & rumours, viral videos and top stories from investmentwatchblog.com Daily Mail and Mail on Sunday newspapers.
Inflation Will Kill This Stock Market – Investment Watch investmentwatchblog.com - get the latest breaking news, showbiz & celebrity photos, sport news & rumours, viral videos and top stories from investmentwatchblog.com Daily Mail and Mail on Sunday newspapers.
Is the inflation I’ve been writing about really all just transitory as Papa Powell claims it is? The Fed Head assures us he has this under control. Would that be just like Father Fed and friends had bank reserves under control right before the repo crisis blew up in late 2019? Or just like they had their Great Rewind under control right before the stock market imploded in late 2018 due to Fed tightening that was promised to be as boring as watching paint dry? Or just like Janet Yellen, the author of paint-by-numbers boredom, now has everything under control, except apparently her yellin’ mouth: ....
In my last Patron Post, which I eventually made available to everyone, I revealed a little-known (at the time) fact that M1 money supply (the most liquid forms of cash bills, checks and basic savings accounts) had grown faster than any time in history. I showed that using a graph like the following, which is now brought up to the most current data: With part of December now in the picture, you can see the faintest hint at the top of the steep late-November climb that shows the climb may be rounding off. I noted, That is a massive amount of new cash money historically massive done almost covertly in the quickest burst ever and yet it did not even cause the stock market to blink!… ....