Exit Liquidity Podcast, @Alto_money Advisooor (posts are my own), Mech Engineer, Macro / Crypto / Defi Nerd
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Nonsense, the RRP has been sitting at negligible levels since late last summer. It didn’t spell imminent trouble then and it doesn’t now either. It was merely the first milestone on that path. Until you start seeing prominent use of the repo facilities or some stresses in dollar funding in the repo market, there is no imminent danger of a financial panic. Lack of RRP just means that the liquidity cushion from the COVID-era money printing has now been removed.
Bank reserves are currently below where they were during the Silicon Valley bank panic so we have to be at or near the lowest comfortable level of reserves. So even though it is not currently time to panic, we should definitely be on the lookout for further deterioration of liquidity conditions…
I will be watching SOFR-IORB spreads (currently sitting at their highest level since last year), dxy, repo rates, and SRF /FIMA repo usage to keep an eye on the situation.
Giving this one a bump for no reason in particular today…
Here is a chart measuring the amount of reserves in the banking system over time. As you can see it is down to levels not seen since 2020. See that period where it was dropping precipitously? That was the last hiking cycle.
T-Bills falling in anticipation of the Fed hiking is going to suck even more money out of the banking system as the haircuts being applied in the repo market suck liquidity out of the system.
Today’s treasury market turmoil is tomorrow’s banking crisis (not literally tomorrow). One sign that we will have gotten into the danger zone will be Repo facilities getting tapped (which we haven’t seen yet).
However, markets can move quickly and the situation could deteriorate fast. Particularly with the backdrop of extremely high energy prices. When energy costs are high it forces counties and firms alike to liquidate dollar denominated assets to keep the proverbial lights on.
They should just get rid of all the chrome books then…
Breaking: Google will turn off web search for schools that opt out of A.I. for kids.
nytimes.com/2026/11/03/us/go…
Seems to me it started to take off when inflation did so it is hard to disentangle the drop in real wages with the actual productivity…
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Now when your TV is spying on you and sending all your data to external parties you can be taxed for the privilege…
BREAKING: France just voted to tax the internet.
French lawmakers approved a tax of €0.055 (5.5 cents) for every gigabyte of data that companies like Netflix and YouTube send to French users. It’s a tax on the companies, not users directly, but the cost could get passed on to subscribers.
The vote was 11 to 10, with only 35 of 577 lawmakers present. Supporters say it could raise up to €10 billion a year. The French government opposed it, warning it would hit smaller French companies hardest; VLC says it would cost it over €1 million a year.
Readers added context they thought people might want to know
This amendment to France's 2027 budget bill was narrowly adopted 11-10 in the National Assembly (35 voters present) but is not yet law, faces government opposition, and must still clear further Assembly/Senate steps.
assemblee-nationale.fr/dyn/17/comptes…
assemblee-nationale.fr/dyn/17/amendem…
capital.fr/economie-polit…
stephanelarue.com/taxe-au-gigaoc…
There is the delusion that has been collectively foisted upon us by the Fed and its ilk that the economy is something that can be managed and you can just ‘prevent’ any negative consequences. It doesn’t work that way! Whether you acknowledge the consequences or not, they are here. This is why society has devolved so quickly since 2008. We have re-inflated every bubble in an effort to prevent the natural consequences of capital misallocation, and now we have so warped our society that it is unrecognizable from the world of 25 years ago.
The oligarchs are doing the math and realizing they need more exit liquidity than these stupid peasants have to offer so they are gonna have to print money and buy stocks “for the kids”. Meanwhile, they will sell their stocks and buy real assets…
Trump Accounts may soon be expanded even more to anyone under 40yrs old. That would be another 100 million people, on top of the 70 million kids and 3.5mil babies born each year. This according to Brad Gerstner who is the main guy spearheading efforts on this. He also said Elon is 'tip of iceberg' Nice scoop and piece on it from @LydiaMoynihan @nypost
Whatever Jamie says with his mouth is the opposite of what his positioning is.
JPMORGAN CEO JAMIE DIMON SAYS U.S. ECONOMY IS BOOMING
JPMorgan CEO Jamie Dimon says the U.S. economy is booming, supported by strong corporate profits, low unemployment and massive AI infrastructure spending.
Dimon believes AI could eventually have a deflationary effect, despite near-term price pressures.
The key risk: Geopolitical conflicts, persistent inflation and rising interest rates could threaten economic growth.
If your argument could also be retroactively applied to railroads, and the stock market crash of 1929, and the dot com bubble, and the crypto bubble of 2021 then it really isn’t a refutation of the position…
