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Andy Fately's avatar

I have been saying for a while now that I expect the Fed to reduce the rate it pays in IOER and start to raise requirements to hold treasuries for both banks and insurance companies as they seek to continue to reduce their balance sheet, reduce their current losses, and ensure that the treasury can continue to issue debt to a captive audience. the banks will scream, but the population will not care. after all, the banks are not paying depositors current market rates, I think my JPM savings account pays 0.02%. If JP takes a haircut on their MRR, it's ok with me, and probably everybody else except Jamie Dimon.

Thank you for an excellent description of the process ongoing in Europe. I'm sure we will see something here in the States soon enough

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