Federal Reserve repo fix is no fix at all

BloombergOpinion/Jim Bianco

“In essence, the Fed has become the lender of first resort when it should be the lender of last resort and offer repo at a penalty rate. The Fed should be willing to help a dealer in need, but it should come at a price.”

USAGOLD note:  Bianco offers a solid critique of the Fed’s new repo and reserves program and ends with a caution.  “The repo market’s problem,” he says, “is far from over.” Bianco was early in calling Fed policy a version of quantitative easing.

Repost from 1-23-2020