Liquidity in the primary dealer Treasury market is drying up. Deposit outflows from the big banks continue unabated. The outflows at the small, regional banks haveg abated but some banks continue to draw on the Fed’s Bank Term Funding Program, which hits a new high almost weekly. The facility matures in March but it’s doubtful the debtor banks will be in a position pay back the loans. Just like the “temporary” repo program that began in September 2019, the BTFP will continue to hit ATH’s and the Fed will extend the maturity of the facility. This is de facto QE.
In my bi-weekly Arcadia Economics podcast, I discuss the indicators that point to a large-scale banking crisis percolating. The day after I recorded the podcast, Citigroup announced 10’s of thousands of layoffs – another sign of the onset of financial distress.
The mining stocks are historically undervalued relative to the price of gold and to fraudulent, fiat securities, especialy in the junior microcap project development stocks. If you interested in ideas to capitalize on the re-instatement of QE, check out my mining stock newsletter: Mining Stock Journal information