Guggenheim's Minerd Says Fed's IOER Model Was Flawed to Begin With

The video discusses the technical moves influenced by tax season and repo market dynamics, suggesting the Fed may face reserve scarcity. It explores the Fed's restrictive reserve policies and balance sheet strategies, highlighting the impact of increased Treasury bill supply on the yield curve and bank reserves. The flaws in the IOER model are analyzed, suggesting the need for new policy tools, possibly through repo facilities.

What factors might lead the Fed to consider a new repo facility?

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What are the implications of the Fed's restrictive approach to reserves?

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How might the increasing supply of Treasury bills affect the banking system?

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What are the potential consequences of the flawed IOER model mentioned?

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In what ways could the Fed introduce a new policy tool to manage liquidity?

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