Repo: How Roughly $1 Trillion Moves Overnight | WSJ

The repo market shook the financial world in September when an unexpected rate spike choked short-term lending, spurring the Federal Reserve to intervene. WSJ explains how this critical, but murky part of the financial system works, and why some banks say the crunch could have been prevented.

Illustration: Jacob Reynolds for The Wall Street Journal

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#WSJ #Repo #Economics

[kanderson]

"Why did the Karens suddenly stop lending?"








Because they needed to speak to the manager

[smoothacceleration]

How convenient when a whole industry has a specially dedicated government entity to bail them out every time they need it... Socialism for the rich.

[fournya]

The WSJ just called paying taxes “having funds sucked out of accounts by the fed” 🙄

[JohnDoe-mxsq]

Remember when this was only going to last for a few weeks?

[nickyc]

Theres def a few banks that almost went broke but they wont tell us who.

[JackEdward]

I love the simplicity of WSJ explanation of financial concepts. Way to go!

[yomammaspoodle]

Oh nooo, poor innocent banks had to pay taxes.... Oooh cry me a river...

[ManhwaMystics]

IMAGINE IF EVERY PERSON OR AT LEAST HALF OF AMERICANS WENT TO BANKS TO WITHDRAW MONEY AT THE SAME TIME

[briansimpson]

banks short-stock trading themselves into negative returns to get more cash on hand... and then complaining that the reason they didn't have the cash on hand is because of new rules put in place requiring them to keep more cash on hand. It's almost as if banks are recklessly dealing with their funds in a way that is liable to destroy the financial system again.

[jaco_g]

Everything is fine. Its only one or two insolvent banks with a risk of default so high that no other bank would lend money to for a period of 24 hrs. Keep swiping those credit cards folks, Christmas is just around the corner.

[connormcgowan]

0:27 How bankers think an Oiler works.

[TheObserver]

I still don't get the part about how everyone is killing it on Wall Street yet the country is now $23 Trillion dollars in debt. Magic?

[Sjalabais]

So where are the feds 60 billion $ coming from? Reserves? Printing press? Magic wazoo?

[IamTonyStark]

This is more like s patient dying of a heart attack getting adrenaline shot, not lubrication .

[ChristopherWalkenPUA]

Just remember guys, QE4 is not really bwahahaha

[Je.rone_]

*Economic geniuses in this comment section* 💪🎭

[alonezlciel]

So, FED bailout the bank again, but in different form?

[kieki]

Why don’t they just better manage their cash flow like any other business

[Marco-wzxw]

LCRs exist in Brazil since 2002. It՚s also worth noting that even prior to implementing
LCR requirements to the most systemically important
banks in Brazil in October 2015, the Central Bank of Brazil has been monitoring the liquidity risk incurred by all the Brazilian banks on a daily basis since 2002. This liquidity monitoring process is performed by means of an indicator conceptually similar to the LCR denominated Liquidity Indicator (LI).

[crispusattucks]

Every time she ends a sentence with a vocal fry, take a shot