07 12 2019 | by Victor Xing | Capital Markets
02 27 2019 | by Victor Xing | Economics
Common catalyst for progressive and conservative populism
12 09 2018 | by Victor Xing | Capital Markets
Kekselias performance review: 1.31% YTD total return
10 14 2018 | by Victor Xing | Capital Markets
Roundabout path in the snap-back of long-term bond yields
09 23 2018 | by Victor Xing | Central Banks
Calm before the storm as quantitative tightening looms
05 20 2018 | by Victor Xing | Central Banks
Alternative narrative on the natural rate of interest
01 07 2018 | by Victor Xing | Capital Markets
Flatter yield curve a symptom of ineffective tightening
12 04 2017 | by Victor Xing | Central Banks
Bond market term premium and wolves of Yellowstone
10 17 2017 | by Victor Xing | Capital Markets
How we learned to stop worrying and love the “fake markets”
09 20 2017 | by Victor Xing | Central Banks
QE’s distributional effects a rising political liability
09 19 2015 | by Victor Xing | Central Banks
Can the Federal Reserve effectively drain liquidity and push up interest rates?
The FED has been testing its ON RRP () as a tool to control the effective Federal Funds rate at times of policy tightening / rate hike.
Under ON RRP, the Federal Reserve sells securities currently held on the FED’s $4.2 trillion balance sheet to a wide variety ofwith an agreement to buy it back on the next business day with interest.
These transactions take cash away from the banks, GSEs, and money market funds, and in effect “drain liquidity” from the financial markets.
With the FED being the dominant borrower (willing to borrow at higher rates), banks, GSEs and money market funds have less desire to provide short-term funding for other entities, thus forcing them to borrow at the rate set by the FED.
Next article09 05 2015 | by Victor Xing | Capital Markets