Please consider a Statement Regarding Repurchase Operations from the New York Fed moments ago.

The Desk has released an update to the schedule of repurchase agreement (repo) operations for the current monthly period. Consistent with the most recent FOMC directive, to ensure that the supply of reserves remains ample even during periods of sharp increases in non-reserve liabilities, and to mitigate the risk of money market pressures that could adversely affect policy implementation, the amount offered in overnight repo operations will increase to at least $120 billion starting Thursday, October 24, 2019. The amount offered for the term repo operations scheduled for Thursday, October 24 and Tuesday, October 29, 2019, which span October month end, will increase to at least $45 billion.

Repo Timeline

Three Fed Statements

  1. Emergency repos were needed for "end-of-quarter funding".
  2. Balance sheet expansion is "not QE". Rather, it's "organic growth".
  3. This is "not monetary policy".

Three Mish Comments

  1. Hmm. A quick check of my calendar says the quarter ended on September 30 and today is October 23.
  2. Hmm. Historically "organic" growth was about $2 to $3 billion.
  3. Hmm. Somehow it takes an emergency (but let's no longer call it that), $120 billion "at least" in repetitive "overnight" repos to control interest rates, but that does not constitute "monetary policy"

On October 8, I noted Fed Seeks Firm Grip On Interest Rates, Supposedly Not QE

Mr. Powell emphasized that the coming moves are aimed at "maintaining a firm grip on very-short-term lending rates."


This is not QE. In no sense is this QE,” said Powell.

Effective Lower Bound

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Firm Grip

It seems the Fed is still struggling to get a "firm grip" on interest rates.


Please review my September 25 post In Search of the Effective Lower Bound.

I claim these "non-emergency", "non-QE", "non-monetary policy" operations suggest we may already be at the effective lower bound for the Fed's current balance sheet holding.

Mike "Mish" Shedlock

$250 Billion Repo Wish Granted

Former Fed officials said the Fed should do $250 billion in repos to alleviate the funding crisis.

At Least $250 Billion In Short-Term Repos Through Oct 17

The overnight and end-of-quarter repo mess is scheduled to last at least a month longer.

Tip of the Iceberg: Emergency Repos Stretch to 2020 Q2

Emergency Fed actions for the end of 3nd Quarter 2019 now stretch to the second quarter of 2020.

Fed Does Another Emergency Repo and Relaunches Commercial Paper Facility

The Fed keeps trying things hoping that something will stick.

It Was Not Effective, But We'll Do It Again

Boston Fed President Eric Rosengren has some interesting comments about QE today.

In Emergency Meeting, Fed Fires All Its Bullets in a Single Shot

Over coronavirus concerns, the Fed just slashed interest rates to 0.00% to 0.25% in an emergency Fed meeting.

US Overnight Interest Rate Surges to 10%, Fed Injects Emergency $75 Billion

Overnight interest rates surged to 10% and no one understands why.

Hussman Sides with Powell: It's Not QE4

A debate over a sudden dramatic surge in Repos is raging. Is it or isn't it QE4?

Fed to Inject $1.5 Trillion in Liquidity But Markets Plunge Again

Although Fed stepped up to the plate today with $1.5 trillion in emergency liquidity, the market continued to dive.