Leveraged Wall Street Trade Is Draining Fed's Reverse Repo Facility | Lou Crandall & Joseph Wang

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Timestamps:
00:00 Introduction
00:40 Reverse Repo Decline Driven By A) Decline In Fed's Balance Sheet And B) Increased Supply Of Treasury Bills And C) Private Repo Market Demand
05:45 The Liquidity Demands Of The Basis Trade (Long Cash Treasurys / Short Treasury Futures) Is Drawing Money Out Of Fed's Reverse Repo (RRP) Facility
12:40 VanEck Ad
13:22 Lou's Accurate Prediction On Why Fed's Bank Term Funding Program (BTFP) Would Not Be Renewed (It Wasn't)
17:10 Fed's Balance Sheet Policy: Quantitative Tightening (QT)
25:23 Summary From Jack
26:54 Money Market Data Could Indicate QT Will Continue For Longer
33:08 Interest Rate Outlook On Fed Cutting Cycle
37:11 Inflation And Real Interest Rates
43:37 Potential Government Shutdown In U.S.??
46:27 Tax Season Approaches! The Plumbing Of Refunds
49:25 Joseph's Closing Thoughts On U.S. Fiscal Situation

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Disclaimer: Nothing discussed on Forward Guidance should be considered as investment advice. Please always do your own research & speak to a financial advisor before thinking about, thinking about putting your money into these crazy markets.

[davecorley]

Excellent video, Jack.

I’ve learned a lot about money, credit, bonds, repo, reserves, ledgers from your interview with Mr. Wang a year ago. I watched him again on George Gammon’s podcast. Between these two videos I learned a lot more about what “printing” M2 money really means. I’ve tried to couple my understanding with Jeff Snyder’s descriptions of the Euro-dollar system and the separate petro-dollar system.

I’d appreciate more videos that unify the hierarchies of US Fed dollar network, the U.S. economy’s USD network, the Euro-dollar network and the petroleum-dollar network.

I’m interested in the sources of liquidity in each of these networks, the sinks in each network and the means by which (if any) these networks allow interchange of USD.

What would also be helpful is understanding the hierarchical position and operation of the BIS (bank of international settlement) in this uber-network of networks.

[HODIUSDUDE]

Fascinating discussion. Thanks for doing these deep dives into the Treasury. Not a headline topic, but an important one.

A better understanding of the interrelationships allows for more informed investment choices. It's content like this that makes me a subscriber. Thanks.

[GenXstacker]

Not only are these two informative, but they also have very relaxing voices 😂

[kkiller]

Speaking of Congress having trouble gathering the willpower to commit to spending more money during record-setting deficits, we all know that the solution they'll eventually arrive at is to try to become Argentina.

[alangivre]

When Synder talks about "eurodollar liquidity" THIS is what he is talking about: MMF lending repo to the private sector. This is why liquidity is actually booming and stocks and bitcoin is upwards.

[SzymonStas]

$95 oil by the end of the year. Oil demand is at all time highs and growing. US supply growth from the Permian, 50% of the worlds oil production growth, might be rolling over. Looks like we didn’t drill enough wells in Feb. Whoops.

[tonya]

Does the Fed Standing Repo Facility provide the Buffer they need for this potential "problem".

[ashanesubasinha]

It is a good interview. Thanks. Except for one thing. Joseph is so wrong about deficit spending. He doesn't get it. If government doesn't have wasted spending government doesn't need to tax citizens so much! Comparing taxation to borrowing has no meaning. All the high deficit wasteful spending in the world doesn't and didn't produce sustainable growth. He has tp stick to his expertise and stop this nonsense. It is good at least he didn't go on to say long term treasury rates will rise to 6%! How many investors lost money following his advice. Sticking to the area of expertise is the only way all the macro analysts can help others.

[nicholaslandolina]

Finance guys m all with trash equioment and headphones

[jtrealfunny]

I just heard the theory that it has been the illegal immigration that has boosted our economy above expectations over the last 2 years or so. That's as good or better than any of the other theories I've heard.

[jacknaneek]

This is all fancy high rising end of sentences talk about central planning and monetizing debt over time. Agenda. Plans.

[jacknaneek]

Is this guy asking a question ? Every statement a question?? Every pause a question?? It makes him unlistenable??