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130 sats \ 0 replies \ @jp 29 Jun 2022 \ on: The Fed & Their Reverse Repo Operations bitcoin
Reverse repos are used for short term lending, typically a sign that banks have no utility for this cash and would rather lend it back to the government vs holding it on their balance sheet; this indicates that banks either cannot find credit worthy borrowers (e.g borrowers currently high debt-to-income ratios) or cannot find asset classes that they are willing to invest additional capital in (e.g. inflated asset prices)