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The liquidity cliff is here. But nothing has changed. Stocks have been rallying. Bonds are rangebound.
We’re now at a critical fork: either the Treasury accelerates issuance to hit its stated goal of refilling the TGA to $850 billion—with immediate catastrophic implications for the markets—or it quietly shifts course, opting for a slower refill path. This path would defer the worst of the impact and introduce a more complex, slow-burn. Which path they take will become clear in the next couple of weeks, but the market is at a fever pitch level now that recognizes neither.
Treasury is flooding the market with new supply. RRP is nearly tapped out. There’s no excess liquidity left—only leverage.
This report breaks down:
• Treasury’s real issuance path vs. stated goals
• The repo market’s capacity to absorb new debt
• Hedge fund basis positioning and unwind risk
• What happens if the money isn’t there
No hypotheticals. Just what’s happening, what it means, and what to watch next.
Get the full report – while the market still pretends this isn’t a problem.