The Repo Market Is In Crisis
And December 31st is when the perfect storm in the repo market is supposed to erupt according to market experts like Zoltan Pozsar.
To take it a step further, another financial expert, Luke Gromen, believes the start of the repo market crisis was the “big event” that signals the dollar end game.
Luke Gromen thinks the Fed will have no choice put to permanently intervene in the repo market, expanding their balance sheet to unimaginable levels.
Mr. X: “If Big Deficits + Tighter Monetary Policy = USD+ , then Big Deficits + Looser Monetary Policy = ______?” Join our weekly newsletter and download the full report at https://t.co/FfnuAPxnBw pic.twitter.com/jMdEyeByVb
— Luke Gromen (@LukeGromen) April 29, 2019
When the Fed adds trillions to the balance sheet via permanent money printing and repo market intervention, the only release valve will be the US dollar.
In other words, the Fed will only have one choice, that's to let inflation run and devalue the dollar to save the repo market and the world financial system.
If you're interested in the future of the US economy and the repo market, this is a MUST WATCH VIDEO!!
Zoltan Pozsar and Luke Gromen both believe the Fed will start QE4, the difference is Gromen thinks they already have started it via the repo market interventions and Pozsar thinks the Fed will start QE4 by buying treasuries directly.
The one thing we know for sure is the Fed has no choice currently but to expand the balance sheet indefinitely with repo market money printing until the lower the value of the dollar enough to let market forces take over.
In this repo market crisis video I discuss:
1. Zoltan Poszars repo market predictions and why they matter.
2. Luke Gromens repo market views and how it plays into the dollar.
3. What will the Feds response be to rates going up in the repo market? Will they lose control of the repo market?