The explanation is that people needed money to pay their taxes but all the normally available liquidity is chasing treasury yields as they have rallied over the last couple of weeks.
The explanation is that people needed money to pay their taxes but all the normally available liquidity is chasing treasury yields as they have rallied over the last couple of weeks.
Woah.
“We think that the culprit is the scarcity of bank reserves, which are the only asset that provides banks with intraday liquidity,” said TD Securities. “Reserves have been declining since 2014 and we expect them to decline further as Treasury’s cash balance increases and currency in circulation grows.”
So, ponzi?