This is one case where I don't mind the clickbait. People need to know how the heck banks got into this mess and this is the first time I've seen an article tie together the reverse-repo market, covid-era money printing, and banks currently sitting underwater on government-backed securities.
It's also worth noting that if you read "banks" in the title to generally mean the banking system, that money is effectively missing as it now sits on the Fed's books and is no longer in the banking system at all. That's a start difference to standard repo markets where the total liquidity of the banking system doesn't change when securities are purchased.
It's also worth noting that if you read "banks" in the title to generally mean the banking system, that money is effectively missing as it now sits on the Fed's books and is no longer in the banking system at all. That's a start difference to standard repo markets where the total liquidity of the banking system doesn't change when securities are purchased.