How Big is That Fed Liquidity Pump? $1.5 Trillion or $5 Trillion?

Mish

The Fed announced huge liquidity measures today. But how big? Is it $1.5 trillion or much higher?

CNBC reports Fed to pump in more than $1 trillion in dramatic ramping up of market intervention amid coronavirus meltdown.

The Wall Street Journal says Fed to Inject $1.5 Trillion in Bid to Prevent ‘Unusual Disruptions’ in Markets.

Repurchase Agreement Operational Details

Today the Fed issued these Repurchase Agreement Operational Details

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Just watching the large Repos, before anything appears to expire I total $5 trillion in repos.

Is the schedule wrong, am I reading it wrong, or are the reports wrong?

Mike "Mish" Shedlock

Comments (22)
No. 1-15
IGA
IGA

They'll have to expand their definition of collateral. I'd bet stocks are included.

Tony Bennett
Tony Bennett

I think you are correct.

Anyways, from accompanying statement:

"The terms of operations will be adjusted as needed to foster smooth Treasury market functioning and efficient and effective policy implementation"

If there ever was a 'break in case of emergency' moment, we're there.

If tomorrow another bloodbath, I expect another announcement prior to Monday opening. Rate cut + QE? Whatever it is, it better be massive and open ended.

Zardoz
Zardoz

Toooo Infinity! And BEYOND!

AWC
AWC

“Trillion “ is so yesterday. The Fed is going to need to go to “Quadrillion”if it expects any respect.

abend237-04
abend237-04

Don't see any other way to read it. The operative term, "at least" suggests to me Powell saying don't get on the wrong side of this one.

rkd80
rkd80

What are these repos exactly? Bond purchases? QE? Do we have specifics?

Russell J
Russell J

I think the one thing to remember is $100 T today or tomorrow won't magically make the supply lines appear ( China ain't "up and running") and the virus stop or go away. It won't instill confidence in the government either, just the opposite.

All these problems we are going to have to deal with and work through will still be here.

Old and weak people are still going to die in very large numbers.

Even if the government spends 2.4 b (800 B / 325 M citizens) per citizen to keep us safe from the virus.

RedQueenRace
RedQueenRace

The real fun for the Fed begins if what is happening leads to widespread downgrades of BBB- / Baa3 bonds into junk territory. Lotsa luck to investment-grade-only funds who have to sell their new junk holdings and those former "investment grade" companies that have to refinance in that market.

Greggg
Greggg

lol
lol

We all know what time it is ,cmon the Repo is cover,most of that 1.5 /5trillion is funneled to the PPT under the table to buy stocks,when will they (if ever)stop pretending.


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