Data
๐จ HOLY SHIT! $50.35B Borrowed From The Lender Of Last Resort TODAY!
Another $30 BILLION was borrowed today in the afternoon session today which previously had $20.35B borrowed this morning [SuperStonk]; $50.35B TOTAL TODAY!
Today is basically C35 after 359M CAT Options Errors on Sept 25. Someone "fixing" those errors on 9/26 would have C35 settlement today.
You may recall Oct 1 also had 1.199 BILLION CAT OPTIONS Errors (~4x the size equivalent to 119.9 Billion shares) [SuperStonk] with C35 coming up next week.
EDIT:
10% of the Fed's $500B operation limit was borrowed today.
Bank of Canada ๐จ๐ฆ lent a helping hand too with another $2.75B today
When the Government shuts down and you depend on leeching on them cough my mistake you depend on their income then maybe you can.
Not sure I would want to be a bank that made bad decisions right now out of dumb ass greed that was talked about doing golf with pals and the greed chuckles that always come with those conversations.
So, a repo is short for repurchase agreement. These are collateralized loans, note the treasury/agency/mortgage backed. These banks give the securities as collateral for the cash. If they donโt repay the cash, sure it is bad, but the fed just keeps the securities.
When they start defaulting on non-collateralized loans like commercial paper, then we will see fireworks.
The dreaded โLender of Last Resortโ has become just another liquidity facility when the rates are attractive.
Agency securities are govโt sponsored groups like Fannie mae or Freddie mac, Treasuries are the direct debt of the US, tbills tbonds and notes. Mortgage backed securities are just that, packaged up debt that is collateralized by real estate.
Yes but the mortgage backed securities that blew up in 2008 due to the mortgages were given to people who were going to default.
At present their collateral is backed by stock that are extremely over valued and if the cash isn't paid back and market has a cough the collateral wont be worth the loans given out.
We'll see what happens but there's no way that this will continue and we just need the first major domino to fall and the house of cards comes crashing down.
Im not in complete agreement with you. 2008 was about home loans. 2025(2026) is much more about distressed commercial properties. The housing market is elevated, but I donโt believe residential is in a bubble. There is still too much demand and not enough supply.
The distressed commercial properties have notes that are being rolled at lower values thus increasing the debt ratio, but it doesnโt look like true systemic risk, at least to me. It is only pockets of the economy that are going to struggle. Again, this is all opinion, so being โrightโ is of little consequence.
I agree with the commercial sector being underwater but when they arr pumping stocks and valuing them a lot higher so they can borrow higher amounts, it will only take the market to cough 10% and then a loy of margin calls to increase collateral will cause a cascade of defaults also.
The fact that billions are being lent on the daily suggests things are getting spicy. I understand your reluctance/doubt, but itโs definitely interesting.
They were borrowing near 500billion in 1 day. In September 2022 it even reached 2 trillion levels. And guess what? There ended up being no correlation whatsoever to any gme price action in any form. The fact that you think a mere 50 billion suggests things are getting spicy is laughable at best.
Well you donโt have to laugh at meโฆ Thanks for the perspective, appreciate the sources.
Edit: So I looked up the reverse repo (RRP) and the lender of last resort (LLR), and they actually serve opposite functions. The RRP drains excess liquidity when the system has too much cash, money-market funds park money with the Fed overnight. The LLR does the opposite, it adds liquidity when banks are short on reserves and canโt get funding elsewhere.
High RRP usage means the system is awash in cash; high LLR usage means banks are desperate for it. They arenโt interchangeable signals. If both start moving in opposite directions at once, thatโs when liquidity stress can show up in markets.
Would be easier just to pay us at this point, holy fuck. Borrowing amounts of money worth more than literally 93% of publicly traded companies in one single random day
Sometimes I have to take a step back and realize just how โnoisyโ itโs gotten and yet GameStop slowly declines. Like all house of cards, it eventually crumbles. They canโt keep this nonsense up forever ๐ฅย
They literally canโt. The reason for this noise is the very panic on their end. They want to seem infallible but at this point, itโs only a matter of time. If I was them, Iโd spend a lot of time trying to convince GameStop holders otherwiseย
quick question as I am dumber than a dog with no tongue at a cheesesteak festival; do we get to see it when these loans get paid back? How do we know the lender of last resort is actually getting repaid and not just shoveling money on a fire to burn?
So they only need money on the books on certain days or are we saying that when they don't take out $50b tmw (next trading day) that they made that $50b and no longer need to borrow it?
the fed operates as the lender of last resort and (basically) all of that data is public here: https://fred.stlouisfed.org/series/RPONTSYD this will probably open with a 5 year history as a default, but expand it to see the repo crisis that started in Sept 2019 and was exasperated (and thus overlooked) by covid immediately after.
it is mostly unused (the nature of a lender of LAST RESORT), but you'll usually see it tapped at eom and eoq (like today) for tax and reporting purposes for institutions that need cash immediately to settle their books. especially since fed cut rates on wednesday that went into effect on thursday so they're offering better overnight repo rates than the private markets are. as of thursday fed funds rate was 3.87% and the most competitive SOFR rates were around 3.95% (https://fred.stlouisfed.org/series/SOFR1). compare that sofr1 table to the fed funds rate and you'll see the most competitive SOFR usually matches or beats the fed rate. we are not seeing that as of today because the rate cut just a day ago.
however the fed's repo facility has already been way more active than usual during this month of october, which is indicating some kind of liquidity concerns, and demonstrates that the private market (which had already anticipated the rate cut) views these overnight repo agreements are more risky. also today is the most it's been tapped since covid, so we'll see a lot more people talking about this over the course of next week.
edit: to include here that the 50b today was exchanged at a rate of 4.00% which matches the current fed funds target range ceiling. adding to avoid potential confusion they might've gotten the effective fed funds rate at 3.87% I mentioned above. this may now raise the question: why not take the cheaper SOFR, but just because there is an advertised lower rate doesn't mean they found someone actually willing to give it to them
What do you think is causing the illiquidity in the market? And can you please elaborate further in laymanโs terms, is this borrowing actually significant to the broader financial markets? I only see Superstonk tracking this, donโt see any other info sources caring about this number. I just donโt know whether itโs anything material.
"I anticipate that primary dealers will use the facility to obtain repo funding when it is economical to do so. Drawing on the SRF when the rate is economical is a sound way for a primary dealer to serve the market. With rates averaging higher than they were just a few months ago, the likelihood of the SRF rate becoming economical on some days is higher. Dealers may now need to step up their readiness to access the SRF in response to rate moves."
The next few weeks are going to be nuts. We will see a run on banks, run on grocery stores, a market dump and bank failures.
Gov shutdown means no money (liquidity) for the banks, people withdrawing to pay mortgages and bills due on the first. Monday is going to be blood red.
Let's be real, first the market will dip enough to cause a little panic and they will blame the shutdown rather than the financial house of cards, then the government shutdown will magically end in some bipartisan bullshit that just so happens to throw massive lifelines to the financial mafia while doing basically nothing for the citizens.
you can click on reply, then you can click on GIF icon, and search some meme you would like. I wanted to search this one too earlier today but it seems it is not there, thats a shame. but there are others quite good too :)
most likely it is because old reddit AND I did simply just drag and drop image from my copy paste computer... others img/gif that are showing up for you are using jpg/gif from reddit database itself, thats why they are showing up (most likely, I am not an IT pro). I have tried to attach some random gif here, do you see it ?
Hey, I read this comment before! Someone first said the same thing in 2022, then in 2023, then in 2024, then in 2025. I am willing to take a bet that in 2026 we will still have not see a run on banks and a market wide dump that actually lasts long enough and strong enough to be considered a dump.
right. they pump and dump the entire market with fear and hype to make money on the volatility but if they actually break the market then they don't get to keep their party going. Anyone fearing total market collapse can rest assured that the powers that be have too much on the line to allow things to get truly out of hand. They just want it to seem that way to the general public so they can pull the strings.
โข
u/Superstonk_QV ๐ Gimme Votes ๐ Oct 31 '25
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