Quite interesting all this talk of tapering and market reaction
reality is fed has been a net seller of it treasuries held outright ( like never before ) dumping thoer holdings since aug 2020
refer to green line in data from last week
top line is the balance of the banks that are taking them
At this rate the fed will hold no us treasuries within a month
when you look at the repo market it then takes them back overnight in bigger and bigger quantities as security for the cash lent to banks that are presumably being asked to buy them
fed treasuries held collapsing
Balance treasuries held by banks exploding
Repo market exploding as fed taking treasures back as security - but that isn’t deemed as they are then held outright
