Bill Nelson on the Fed’s Discount Window Lending, the Overnight Reverse Repo Facility, and the Shifting Size of the Fed’s Balance Sheet
Macro Musings with David Beckworth
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The Fed's Overnight Reverse Repo Facility and Reserved Balances
The overnight reverse repo facility began in 2013 and part of the reason for its ongoing existence is that it helps plug a leaky floor system. A question then is are money market mutual funds helping pay for some of the the lending the fed is doing and the banking turmoil or maybe this would have been already coming from the banks if not from money market funds just maybe the funds are changing the source but it would have been the same no matter what so that's a great question as the fed made those loans their liabilities increased they had to borrow the money.
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