07-08-2024 Liquidity is running dry, "It’s So Lonesome it Could Cry."---------------------Hear that lonesome Repo well. It sounds too low to fly.Last week, the implied likelihood of a September Fed rate cut rose to 73%. Over a week ago, it was 62%.Bonds cry for a “higher for longer” Fed. But the fall of the dollar and the steadfastness for gold suggest that turmoil is ahead.Recently, clogged bank balance sheets caused a spike in repo rates while reserve balances declined. Will the Fed accelerate the QT taper that it began in late 2023?Liquidity is running dry, It’s So Lonesome it Could Cry.--------------------------Song: I'm So Lonesome I Could Cry (1949)https://www.youtube.com/watch?v=4WXYjm74WFI

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