Joseph Wang on the Fed’s Impact on Money Markets
Macro Musings with David Beckworth
00:00
The FEMA Standing Repo Facility - What's Happening?
The Fed also announced they're going to make the FEMA standing repo facility for foreign international monetary authorities. So if you don't have access to the Fed, what you do as a sovereign is you self-insure. And that dollar fund is held in the form of treasuries, which are not credit risk to be money-like assets. If there's a run on dollars' needs from Chinese banks, the sovereign can backstop that even without the actual facility by sellingTreasury and using those proceeds to into their banking system.
Transcript
Play full episode
