Today's topics include the initial claims numbers are about to get crazy, the Fed is likely to increase its Treasury purchases beyond $500 billion, risk parity, record bond fund outflows, more debate on shutting down markets, filling the strategic petroleum reserves, and Lagarde will do everything necessary.
The dealers' balance sheets are full and post-crisis rules are preventing them from expanding. The Fed is trying the drain dealers' balance sheets via QE, allowing more room for dealers to operate. The problem is the markets are repricing for a new post-virus world. When banks are able to make a market, there is only selling. This stops when markets fall enough that the full damage is priced in.
Today's topics include the Fed has another busy 24 hours, the ECB launches 750 euro debt purchase program, banks hoping for easier regulation, Bloomberg calls for massive infrastructure spending, the 60/40 portfolio not immune to wild swings, a container shortage, guessing the budget deficit, the return of the 50-year bond?, and stock buybacks.
Today's topics include another busy 24 hours for the Fed, bonds' wild swings, Bernanke and Yellen suggest the Fed buys corporates, fiscal stimulus, ETFs feel the pain from liquidity squeeze, oil glut about to hit max capacity, the ECB clarifies an official's comments again, and companies' credit lines.
Japan remains the largest foreign holder of Treasury securities for the eighth month running, but the Fed owns more than China and Japan combined.
Today's topics include tracking stocks' slide, the call for fiscal stimulus, keeping up with the repo market, more on the idea of shutting down the markets, shedding the stigma of the discount window, a history of FX swap lines, and betting on duration.
A replay of our March 17, 2020 conference call
Central banks fired all their weapons to stop markets from declining, but U.S. stock futures are locked limit down as we write. The central bank "put" no longer works. If risk markets make new lows, regulators and government officials may have no choice but to close the financial markets to prevent chaos and lasting damage.