tyb
>>18724564, >>18724602, >>18724683 pb
PlaneFag CONUS/Europe Update
SAM684 C-40B west from JBA (was used as AF2 last week) usually a State Dept AC (used by Pompeo for Int'l and domestic, Yellen uses now)
SPAR693 Learjet 35 arrived at JBA from Peterson SFB depart
Egyptian AF SUBTT Falcon &x arived at New Castle Crt Airport DL
PAT262 Beech Super king Air arrived at Dothan Reginal Airport, AL from Davison Airfiled depart
RCH3219 C-17 went to Miami Imt'l (no PatrickAFB) from DoverAFB depart
11-3016 USAFSOC C-46A Wolfhound stopped at Playa del Carmen and is arriving at mobile, AL
RAF RRR7041 P-8 Poseidon arrived at NAS Jax from RAF Lossiemouth (northern Scotland) departure earlier today
SPAR28 G5 Ind-Pac Brass NE from Hickam AFB depart
LBRTY62 C-2 Greyhawk south from Pt. Mugu
Europe
German AF GAF526/129 A400m SE from Hanover RAF RRR2894 A330 MRTT and RAF RRR4990 C-17 from RAF Brize Norton along with RCH453 and 336 C-17 east from Moron AN and Rota NB respectively looks like they are heading towards Africa (mebby Sudan?) >>18725745 lb although the German AF A400ms have been going to Souda Bay recently
AE5224 think this is a P-8 @19k ft also east
Bank Bailout Facility Usage Rises First Time Since SVB, MM Fund Outflows Soar
After last week saw The Fed's balance sheet shrink significantly back from its bank-bailout resurgence, all eyes will be back on H.4.1. report this evening to see if things have continued to 'improve' or re-worsened amid regional bank shares unable to bounce above post-SVB lows ahead of earnings. In a big surprise, this week saw a $68 billion OUTFLOW from Money Market funds - the largest since July 2020 (after $380 billion of INFLOWS over the previous five weeks)…The breakdown was $58.9 billion from Institutional funds and $9.72 billion from retail funds.
That pulled assets from their $5.277 trillion record high and suggests last week's deposit INFLOWS may be about to accelerate - good news for banks? Added to last week's deposit inflows, this suggests - in the short-term - the banking crisis is easing (at least in the minds of investors). However, it's never that easy, as BofA noted earlier, it's that time of year again when corporations pull cash from MM funds to pay taxes. In 2022, the 3rd week of April saw $41.6bn of institutional outflows from MM funds. In 2021, the same period was institutional outflows of around $19.6 billion. 2020 was a COVID shitshow, but 2019 saw a $42.3 billion withdrawal. So this year's $59.8 billion institutional outflow is significant in its size compared to the last few years (but the seasonal tax-driven nature of the outflow should counter any over-excitement for now). (and since the NYFRB Reverse Repo Facility is still well over $2T a night they would be right imo)
Today $2.277.259B @ 4.80%-Cap#3
https://www.newyorkfed.org/markets/desk-operations/reverse-repo
The most anticipated financial update of the week - the infamous H.4.1. showed the world's most important balance sheet shrank for the 4th straight week last week, by $21.5 billion, slightly more than last week's tumble (helped by a $17bn QT)…(this "QT" is just maturing bonds on the sheet…it's not doing a thing..it would habben no matter who owns them)
Looking at the actual reserve components that were provided by the Fed, we find that Fed backstopped facility borrowings ACTUALLY ROSE last week from $139 billion to $144 billion (still massively higher than the $4.5 billion pre-SVB)-Cap#4…but the composition shifted, as usage of the Discount Window rose by $1.6 billion to $69.9 billion (upper pane Cap#5) along with a $2.1 billion increase in usage of the Fed's brand new Bank Term Funding Program, or BTFP, to $73.98 billion (middle pane) from $79.0 billion last week. Meanwhile, other credit extensions - consisting of Fed loans to bridge banks established by the FDIC to resolve SVB and Signature Bank were unchanged at $173BN (lower pane)..Scanning down the H.4.1, we note that Foreign repo was down $10BN to $20BN (though it is still troubling that some bank still needs this much USD) and Other Fed Assets rose $2.2 billion (after falling last month) With the MM outflows, deposit inflows, and Fed balance sheet shrinking again, it appears the 'banking crisis' is over… and with it goes the hopes for equity bulls that The Fed will ease away from its inflation mandate… be careful what you wish for here as with clarity comes fortitude and The FedSpeak recently has almost all sung from the same hymnal - higher for longer, inflation still too high… not the massive loosening-fest the market is hoping for in H2 2023.
We will simply have to wait and see to know if these outflows are "real" of simply the usual tax-driven withdrawals.
https://www.zerohedge.com/markets/fed-balance-sheet-shrinks-4th-week-money-market-funds-see-largest-outflows-almost-2-years
The 'Bank Term Funding Program' is run out of the U.S. Treasury's Exchange Stabilization Fund
America's Darkest Secret: The Exchange Stabilization Fund'
https://steemit.com/informationwar/@richq11/america-s-darkest-secret-the-exchange-stabilization-fund
from yesterday
As everyone rushes to the "safety" of Corporate Debt
TD Spots a Red Flag Not Seen Since 2007 Coming for the Corporate Bond Market
Last month’s banking drama means a technical tidal wave may be coming for the biggest slice of the $10 trillion market for corporate bonds. That’s according to TD Securities, where analysts are predicting that banks’ collective higher cost of funding will curb appetite for higher-quality credit and eventually force a spike in risk premiums.
At issue are shrinking yields on investment-grade bonds relative to the effective federal funds rate, a proxy for funding costs. This “carry spread” has now reached levels seen only twice before in the past 27 years — the last time being in 2007.
That means that even though high-quality corporate bonds might look “cheap” based on their mark-to-market values, which have plummeted over the past year as interest rates spiked, the higher cost of funding these positions could still curtail bank purchases and eventually force a move higher in spreads.“The US recession we forecast in the final quarter of the year, along with the recent collapses of Silicon Valley Bank and Credit Suisse, has heightened the risk of a correction in the US investment-grade corporate bond market,” says Cristian Maggio, TD’s head of portfolio and ESG strategy. “Tighter lending conditions ahead may act as a catalyst for this correction.”
While banks aren’t the largest investors in the corporate bond market, they do play an important role in facilitating trades and providing liquidity for other investors. To do so, banks have to allocate precious regulatory capital and balance sheet — something which is becoming both more scarce and expensive in the aftermath of March’s banking collapses and a wider flight in deposits.
So even though banks own just 7% of outstanding corporate bonds, according to TD’s estimates, they could still drive a correction in credit risk premiums that are low by historical standards. Maggio estimates that carry spreads are now just 23 basis points, marking the third-tightest level in data that begins in 1996. “Banks are important in this context as their sensitivity to interest rates may pressure US investment-grade corporate yields to correct,” Maggio says. “While unfunded investors (a large share of the market) may be content with a modest yield pick-up over Treasuries, liquidity providers need margins large enough to beat their internal funding costs.”“Against this backdrop, the widening of credit spreads we anticipate is necessary to re-balance the market and address pressure from the increasingly exhausted carry trade.”
https://www.bloomberg.com/news/articles/2023-04-19/td-spots-a-red-flag-not-seen-since-2007-coming-for-credit-market
…Disclosure for TD Charles Schwab owns TD and bought in 2020 for $26B they (TD) had a recent share sale (Aug '22) of Charles Schwab shares and Schwab bought them and important since the last few weeks has seen Schwab Bank be put forward as the next 'trigger'…
TD Sells 28,400,000 Shares of Schwab Common Stock
https://stories.td.com/ca/en/news/2022-08-01-td-sells-28-2c400-2c000-shares-of-schwab-common-stock
Right over to Schwab
Schwab Repurchases $1 Billion of Shares Held by TD Bank Group
https://pressroom.aboutschwab.com/press-releases/press-release/2022/Schwab-Repurchases-1-Billion-of-Shares-Held-by-TD-Bank-Group/default.aspx
Please refresh..Spam being removed
Thank you