While many obsess over the debt ceiling fight, markets ponder what an agreement will bring in terms of liquidity drain, as the Treasury refills its general account at the Fed. Money used to buy T-bills means money not hitting the system elsewhere (until govt spends it). We wait.
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Won't it be new money anyway?
No, new Treasury issuance isn’t new money itself, it’s new debt. Only the Fed and banks can create new money through QE or loans.
Are banks handing over their cash in exchange for t bills?
The Fed will likely need to buy the new Treasuries from the banks, which will offset the liquidity drain, I'd guess.