Just had a crazy week for Fed Balance sheet and TGA
All numbers in $MM.
Looks like we had $109Bn QE in the past week. (yields down, good for the market)
But the $300Bn stimulus is causing short-term indigestion issues soon
(-ve = QE/spending, +ve = QT/tax)
All numbers in $MM.
Looks like we had $109Bn QE in the past week. (yields down, good for the market)
But the $300Bn stimulus is causing short-term indigestion issues soon
(-ve = QE/spending, +ve = QT/tax)
The indigestion problem seemed to have developed at the end of Feb, when QT + deficit spending became very toxic.
QE + deficit spending seemed to be okay.
QE + deficit spending seemed to be okay.
Had to spend some time to investigate some highly unusual activity, where a whale pulled $200Bn liquidity in short order, and then puked it back between 2/17 and 3/2.
Will finish up writing up the projection for the next two weeks today and launch the newsletter today.
Will finish up writing up the projection for the next two weeks today and launch the newsletter today.
$60Bn worth of QT next week, plus more deficit spending, plus $186Bn worth of new T-notes to be auctioned next week ($48Bn of new money)...
Will we see a 2nd-round of bond tantrum? stay tuned.
Will we see a 2nd-round of bond tantrum? stay tuned.
Final number came in with $114Bn increase in Fed B/S.
The small 5% difference in my projection comes from Treasury's FX reserve book and Fed's PPP loan book.
The small 5% difference in my projection comes from Treasury's FX reserve book and Fed's PPP loan book.
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