Chillin' out till it needs to be funded
Of course it’s not Rinse. Wash. Repeat. anymore, it’s just Borrow from ECB, Deposit at ECB. and ECB can’t see much lending but liquidity is there. Welcome drops in yields apart, the deposits at ECB have finally hit a $1 Tln (EUR 776.94 Bln) today on Friday and though they won’t stay that high, the notation of an ECB Balance sheet probably requires a new numerical long form for amounts beyound a Million Trillion, maybe a LTRO-dillion-dallion and Mario will of course get an Onion medallion or the Sam, Bilbo and Frodo equivalent from Peter Jackson’s Studios and we can just call it a ring.
The deposits rose 63% overnight but then they had dropped to EUR 444 bln, left to Corporate alone, who still do get paid to go to the local bank branch. Also there is a lot of deleveraging ahead so the entire EUR 500 bln can disappear in the next six months. Heavy Italian repayments are due in 2013. Some banks that had been using the ECB overnighters disappeared freshly juiced on low Collateral LTRO loans, overnight exposure down from EUR 3 bln earlier in the week to EUR 500 mln odd yesterday
And apparently the blogs and the banks will not be in such a rush this time from the event of borrowing and deposit at ECB alone as that is something we are all getting used to. It is already low key, bu tthen so is Japan , growing stronger currency on a weak Economy for 30 years probably only as a foretaste of what we need to learn for in these next ten years in Europe and the USA