The Institutional Risk Analyst

With the FOMC cutting the target for fed funds one quarter point last week, we expect to see funding costs for banks continue to fall, part of the larger narrative that has seen bank loan demand and share repurchases leaving a great deal of dry powder.  Deposits are growing 2x loans, meaning that the balance must go into securities. One of the reasons that lenders of all sorts have been pushing down loan yields is to capture assets in a market that is short quality duration.

The real threat of tariffs announced by Trump is not inflation, but rather a LT decline in the dollar as the global reserve currency

The big story nobody is discussing is the fact that large banks led by JPM, BAC and TFC continue to sell off briskly