Cracks emerging in money markets?

Discussion of the Cash portion of the Permanent Portfolio

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ochotona
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Re: Cracks emerging in money markets?

Post by ochotona » Tue Oct 15, 2019 2:54 pm

shekels wrote:
Tue Oct 15, 2019 10:59 am
When is QE not QE?
The new-new-new plan.

https://wolfstreet.com/2019/10/11/10-ye ... ury-bills/
Through Q2 2020. I wonder if they can really stop at that point.
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Tortoise
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Re: Cracks emerging in money markets?

Post by Tortoise » Tue Oct 15, 2019 6:39 pm

Sounds like a de facto standing repo facility, which the Fed proposed earlier this year.

If so, maybe at some point they'll just "make it official" and replace their current ad hoc repo market interventions with a standing repo facility.
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sophie
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Re: Cracks emerging in money markets?

Post by sophie » Wed Oct 16, 2019 7:22 am

Oh of course. That would be because I just bought long bonds!
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technovelist
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Re: Cracks emerging in money markets?

Post by technovelist » Sat Oct 19, 2019 6:30 pm

sophie wrote:
Sun Sep 22, 2019 8:42 am
77% repos? That's gone up since I last checked (was about 60%). Crazy.

I only wish FDLXX could be used as a sweep account. It's not that hard to keep shifting cash into it though. With the smartphone app I can do it while walking to work, or while stuck in boring meetings. I also have 3 sets of T bills on autoroll, and it looks like you can add to those positions anytime with the "buy" button. Pugchief have you tried that?
Thanks for this info, everyone.
Most of my Fidelity assets are in two sets of T-bills with autoroll.
I have just entered an order to move most of my "cash" (about 25% of my Fidelity account) from SPAXX to FDLXX, which should be executed on Monday.
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Kriegsspiel
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Re: Cracks emerging in money markets?

Post by Kriegsspiel » Sun Oct 27, 2019 6:43 am

https://www.marketwatch.com/story/the-f ... 2019-10-25

This chart has vertical lines on it.

Image
All of humanity’s problems with coronavirus stem from a man’s inability to sit quietly in a room alone.
- Blasé Kriegsspiel
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Smith1776
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Re: Cracks emerging in money markets?

Post by Smith1776 » Tue Jan 14, 2020 2:08 pm

Kriegsspiel wrote:
Sun Oct 27, 2019 6:43 am


This chart has vertical lines on it.
lmao.
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"Someday we could be a shining beacon of hope for the oppressed people of the world. Just as so many oppressed and violated souls have found refuge here already. Will it happen overnight? No. Will it happen in a lifetime? I don’t know. Is it worth fighting for until my last breath? Of course. Once you’ve seen what’s possible, how can you do otherwise?"
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shekels
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Re: Cracks emerging in money markets?

Post by shekels » Wed Jan 15, 2020 10:56 am

Repo Market Simplified, or maybe not. :-\
Printing is always an option until it is not.
Jeff Snider has his opinion explained.


https://www.youtube.com/watch?v=w5AR-KBVgJ0&t
¯\_(ツ)_/¯
SPX < 1800
Gold < 1300. Maybe 1000, Will buy more there.
welderwannabe
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Re: Cracks emerging in money markets?

Post by welderwannabe » Wed Feb 05, 2020 1:38 pm

Im not sure there are cracks emerging in money markets. There are many theories on why this is happening. One is the concern about counterparty risk which really came to the forefront with the MBS crisis.

My theory is that is is more likely because the Fed started paying interest on reserves, both required and excess. The fed pays 1.6% right now on any reserves held with it. If a bank can just deposit with the fed and earn a guaranteed 1.6%, why bother with the repo market and take whatever limited repo risk?

They started paying interest on reserves to make it more palatable for banks to have higher reserves....making them stronger. However, this is a form of money tightening IMHO.

Therefore the Fed is stepping in.

Its definitely broken, but im not sure I would read in that there is a lot of risk in money markets now.
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Smith1776
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Re: Cracks emerging in money markets?

Post by Smith1776 » Thu Feb 06, 2020 3:59 pm

I keep reading this thread title as something like "emerging markets money market funds".

And i'm like... why the hell would anyone buy something like that??? :D
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"Someday we could be a shining beacon of hope for the oppressed people of the world. Just as so many oppressed and violated souls have found refuge here already. Will it happen overnight? No. Will it happen in a lifetime? I don’t know. Is it worth fighting for until my last breath? Of course. Once you’ve seen what’s possible, how can you do otherwise?"
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