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Reverse Repo
There's currently over $2 trillion in reverse repo sitting on the Fed's balance sheet. As I understand it, this could give the Fed a huge release valve if economic conditions continue to worsen without them having to lower interest rates. So can you walk us through first maybe what repos are in general, then how the repo tool came about and why we are now looking at the reverse repo? Yeah, absolutely. The repo market repo stands for repurchase and not a repossession like a car and a bank. And so the repo market is one where the banks would go to each other, very basically simply, oh, I'm oversimplifying it here overnight.