Central Banks’ Central Bank Warns About Rehypothecation Threats | Zero Hedge

Tyler Durden writes:

…….none other than the TBAC warned that the US is suddenly facing a $10+ trillion high quality collateral shortage in the next decade. As we have also explained, this is a major problem for the Fed which at current rates of QEeing, will monetize all Treasury duration exposure in roughly 5 years – at that point there will be virtually no collateral left and the Fed will be finally out of both tools and ammo.

I suspect that fiscal deficits will add sufficient new Treasury bonds to the pile, so that the Fed never has to run out of decent collateral.

Read more at Central Banks’ Central Bank Warns About Rehypothecation Threats | Zero Hedge.

Banks Face Funding Stress – WSJ.com

LONDON—European banks, increasingly concerned about their ability to access funding, are devising complex and potentially risky new deals that enable them to continue borrowing from the European Central Bank…..

They also are a sign that struggling banks across Europe are preparing for a period of prolonged reliance on financial lifelines from the ECB. The Continent’s intensifying financial crisis has made it difficult for many banks to obtain funding from customary market sources.

via Banks Face Funding Stress – WSJ.com.