Stealth QE: Feds balance sheet grows $300B, Bitcoin breaks $26,000 Stealth QE: Feds balance sheet grows $300B, Bitcoin breaks $26,000

Stealth QE: Feds balance sheet grows $300B, Bitcoin breaks $26,000

Fed balance sheet grows by $300 billion as fed discount window borrowing hits-all time high and BTC breaks $26,000.

Quick Take

  • One week from the fallout of SVB, with “higher for longer” calls for interest rates to tame four-decade-high inflation, the Fed has capitulated.
  • The fed balance sheet has expanded by over $300 billion this week.
  • In layman’s terms, BTFP allows institutions to swap devalued assets for full-value cash (money coming from nowhere).
  • In addition, the fed’s discount window went parabolic to $148 billion this week, the highest level since 2008.
  • Again in layman’s terms, distressed banks calling for Fed liquidity.
  • The Fed balance sheet has jumped to $8.69 trillion โ€” wiping out half the quantitative tightening they have been doing for the past year.
  • As I said yesterday, Bitcoin sniffs out any liquidity in the market. As a result, Bitcoin is above $26,000.

Balance Sheet Growth

  • Approximately +$148.3 billion โ€“ net discount window borrowing.
  • Approximately, +$11.9 billion โ€“ the new Bank Term Funding Program

Subtotal: $160.2 billion

  • Approximately +$142.8 billion โ€“ borrowing for banks seized by FDIC Total:

This totals = $303 billion

Total assets Fed Balance Sheet: (Source: FRED)
Total assets Fed Balance Sheet: (Source: FRED)
Fed Discount Window: (Source: Joe Consorti)
Fed Discount Window: (Source: Joe Consorti)