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Reverse Repos Went Crazy Last Week On Fed Parlor Tricks

How pathetic is this bunch of clowns at the Fed. Thanks to a couple of special end of month Reverse Repo operations for window dressing purposes, the Fed put out $450 billion of this silly putty paper so that it would show up on bank and money market fund balance sheets for the September 30, end of quarter print. As of today, October 6, the amount outstanding was back to a more normal $130 billion.

What possible legitimate purpose this kind of silliness might serve, I’ll leave to your imagination.

Liquidity moves markets!

Follow the money. Find the profits! 

Meanwhile our composite liquidity indicator has risen by all of 1% since a late January peak. That is tight ladies and gentlemen. It’s not sufficient to support an extended rally in stocks. Get your kicks out of this one while you can.

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Lee Adler

I’ve been publishing The Wall Street Examiner and its predecessor since October 2000. I also publish, and was lead analyst for Sure Money Investor, of blessed memory. I developed David Stockman's Contra Corner for Mr. Stockman. I’ve had a wide variety of finance related jobs since 1972, including a stint on Wall Street in both sales, analytical, and trading capacities. Prior to starting the Wall Street Examiner I was a commercial real estate appraiser in Florida for 15 years. I was considered an expert in the analysis of failed properties that ended up in the hands of bank REO divisions, the FDIC, and the RTC. Remember those guys? I also worked in the residential mortgage and real estate businesses in parts of the 1970s and 80s. I have been charting stocks and markets and doing analytical work since I was a teenager. I'm not some Ivory Tower academic, Wall Street guy. My perspective comes from having my boots on the ground and in the trenches, as a real estate broker, mortgage broker, trader, account rep, and analyst. I've watched most of the games these Wall Street wiseguys play from right up close. I know the drill from my 55 years of paying attention. And I'm happy to share that experience with you, right here. 

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