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👉The more PAINFUL the SHORT TERM is, the better the medium term will be as liquidity is RELEASED

🚨Banks have +$395 TRILLION in UNREALIZED LOSSES

💥The FUND market shows signs of STRESS similar to those of 2020.

-The spread between the SOFR (the actual market repo rate) and the IORB (the rate the FED pays on bank reserves) skyrocketed to 32 basis points, the highest level since the COVID crisis.

What does this mean⁉️

-When the SOFR exceeds the IORB, banks are paying more than they should to obtain cash.

-In other words: there is a liquidity shortage and banks are desperate for short-term financing.

-These types of tensions often precede interventions by the FED... and that was exactly what happened.

🔸The response of the #Fed

-In just 5 days, the Federal Reserve injected $125 billion into the banking system through the emergency repo program (SRF).

-These operations are very short-term collateralized loans that prevent the money market from freezing, but also reveal a growing structural fragility.

Why does this happen⁉️

-The U.S. Treasury, with the shutdown still active, retains more than $1 trillion in its account (TGA), draining cash from the system.

-The TGA went from $300B to $1T in just 3 months!

-This forced retention and reduction of liquidity means that banks must turn to the FED to stay operational.

-At the same time, bond yields remain high, making credit more expensive and reducing the availability of capital.

🔸The other bomb: commercial real estate

-As money becomes more expensive, the office market is collapsing.

▪️Delinquency in commercial mortgage-backed securities (CMBS) for offices rose to 11.8%, surpassing the peak of the 2008 crisis.

▪️Banks have many of these bonds and this is one of the reasons why banks have +$395 trillion in unrealized losses.

What could come⁉️

-When the shutdown ends and the Treasury releases its cash, we could go from total drainage to a massive liquidity injection, equivalent to a covert QE.

📍History repeats itself: what today seems like a liquidity crisis can become the catalyst for the next rally.

📍The key is when and how the money trapped in the Treasury is released.#MarketPullback #BTCDown100k #PrivacyCoinSurge #CPIWatch $BTC $BNB $SOL