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Michael Howell: "QE Is Coming Back, Big Time"

Forward Guidance

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The Positive Correlation Between Treasury Bill Issue and Global Liquidity

There's a positive correlation between treasury bill issuance and global liquidity that's somewhat paradoxical, because all things being equal, Treasury Bills drain liquidity from the system. Michael Bociurkiw: The federal reserve's balance sheet has actually declined with the exception of margin April and the bank term funding program and the discount window. He says if those funds come out of the reverse repo pool, then it's not a drain of fed liquidity. That inflection in September of last year, I think was triggered by the British guilt crisis," he adds.

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