We saw the Fed issue a historic increase in the Fed Fund rate this week. It sent rates up 75 basis points. Unfortunately, we are seeing a reverse effect.
In this video we look at the 4 week TBill, which is going for more than 50 basis points below IOER and Reverse Repo. How can that be? Why would a bank pay more money to get a smaller return?
The answer is contained in the video.
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