Repo Crisis Averted, Maybe… – Private Wealth Advisors

Thursday, January 02, 2020

Repo Crisis Averted, Maybe…

by Marty Mazorra CFP®, ChFC®

Founder & Co-Chief Investment Officer

We’ve scratched the surface a bit herein the past few weeks on what can only be termed as a serious liquidity issue in the overnight funding (repo) market. While some suggest that it’s not serious, that it’s purely technical, and so on, well, when a technical glitch requires half a trillion in fresh bucks to simply keep liquidity flowing (as opposed to actually fixing the problem) I think we can get away with calling it serious.

As for the stock market — which is seeing continued positive momentum in the pre-market this morning — all it sees is Fed money printing, and it loves it. Hates it when it ends.

Here’s a 5 minute clip featuring analyst Jim Bianco on the topic, and how it reminds him of the Fed intervention around Y2K:

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Marty Mazorra CFP®, ChFC®

Founder & Co-CIO

is the author of "Making Lemonade: A Bright View on Investing, on Financial Markets and on the Economy" and "Leaving Liberty?: Essays on Politics and Free Market Thinking".

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