With a new week comes hope that we have turned the page on all those tricky problems that were previously plaguing the markets. Stocks may be down a touch this morning, but hey--Bitcoin's higher! The government shutdown was averted! It's also the start of new quarter now, with September--a notoriously tough month for stocks--thankfully behind us.
Before letting these narratives take hold, however, it's important to realize just how significantly the landscape has changed since stocks peaked in late July. explained Bridgewater co-CIO Greg Jensen. Basically, Treasury had issued a lot of very short term bills earlier this year to fund the deficit, which were easily absorbed by the market as they supplanted what the Fed had previously offered in its repo facility (which"As T-bill rates rose [to] slightly higher than the repo facility, money just shifted right out of that repo facility into T-bills, which meantand explains why the market and the U.S.