Too big to lend? JPMorgan’s cash tweaks take toll on U.S. repo

Reuters/David Henry

“JPMorgan Chase & Co has become so big that some rival banks and analysts say changes to its $2.7 trillion balance sheet were a factor in a spike last month in the U.S. ‘repo’ market, which is crucial to many borrowers.”

USAGOLD note:  Much conjecture has surrounded the Fed repo market cash injections as to who or what might have been the cause of the sudden drought.  None of that speculation mentioned J.P. Morgan.  Now we learn, through this Reuters article, that a shift in strategy at JPM was responsible “for about a third of the drop in all banking reserves at the Fed during the period.”  That said, JPM’s involvement might still be just another piece in a multi-dimensional puzzle yet to be completed.


Repost from 10-2-2019

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