FateTrading

[FateTrading @FateT80966]

@datboibonvpvrt @Sorenthek In order to be the world's reserve currency, you want the dollar to be weak. You want it to be abundant. So the exact opposite. A higher dollar is bad for the world. But JPY is cheap, even cheaper than the yuan.

[FateTrading @FateT80966]

@Sorenthek Inflation is the "justification" to increase rates. Look at ON RRP and inflation, see the trend. ON RRP is used to control short term yields. The question should be, why is Yellen issuing short term to decrease ON RRP. What are they trying to hide. When them bonds run off???

[FateTrading @FateT80966]

@Sorenthek Dollars are returning to the US, that can happen in many forms. But the reality is, ON RRP is decreasing. ie) the treasuries can be rehypothecation again. idk if Yellen is good or bad, but she is causing ON RRP to decrease. This is good for both parties. Reserved down, markets up

[FateTrading @FateT80966]

@TFL1728 Also, the TGA is a liability for the fed, "default" was a lie to lower the TGA at a time when the federal gov receives cash and the TGA normally spikes. The threat of "default" was to reduce the risk to the fed, nothing more.

[FateTrading @FateT80966]

@TFL1728 fed cuts if excess reserves are increasing. Market yields are decreasing bc ON RRP is used to influence control short-term, but the treasury is issuing short-term resulting in a decline in ON RRP. ON RRP prevents rehypothecation. Fed wants ON RRP to decrease to decrease reserves

[FateTrading @FateT80966]

@TFL1728 When bonds roll off the balance sheet, treasury will issue new bonds, banks are at risk of runs, this is why fed Now was added to increase liquidity. Runs happen regardless of who buys the bonds outside of the fed.

[FateTrading @FateT80966]

@TFL1728 And the sad part, all of this is in the Federal Reserve Working Papers. Both the corridor system and ON RRP are 2016 papers. Bernanke wrote about ZLB in 2016 or 2017. JPow literally followed his plan.