A recently issued report from the World Gold Council surmised that it was “feasible” for as much as 1,000 tons of physical gold to have become entangled with financing deals in China last year. That would/might account for some portion of the physical metal that has moved East in recent years, as metal inventory has long been a popular staple [...]
I’m not sure what popular perception believes of international holdings of “reserves”, but I would wager there is a rather large disconnect between it and how the international system actually works. This is more than just theoretical notions of banking in eurodollar shadows, but the pipelines that connect and cross the globe. Central banks do not have massive stores of [...]
Back in April, there had been, as I posted yesterday, a change in funding conditions for dollar markets. It was, by most accounts, imperceptible except for the strange secondary collateral and liquidity indications that began to appear with more frequency. Sitting in the intersection between liquidity, monetary policy and the real estate re-bubble, Wellington Denahan, CEO of Annaly Capital, the [...]
Repo markets are flashing warnings again, as conventional explanations fall short of full comprehensiveness. We learned today that US treasuries across the curve are once again trading very special in the repo market, meaning negative repo rates for US notes from 2 to 10 years in maturity. Technical factors play a role, as this week’s auctions will change over the [...]
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