Marv: > I have very great difficulty understanding how the reserves Goldman and JPMC > keep on deposit with the Fed explains their profitability.
I never remember saying anything like the above. All I said was what is below: > A big chunk of the money they are making may be coming from here: > > http://research.stlouisfed.org/fred2/series/BOGNONBR?cid=123 > Given that the Fed pumped a lot of money through Wellington to the GSEs, more than $1 Trillion, and the GSEs are willing to lend that money to the depository institutions at the effective Fed Funds rate, there is clearly arbitrage there. This may be the reason why non-borrowed reserves are so unusually high. Given that this started about a year ago, some banks must have made hundreds of millions. What is puzzling about this? Best, Sabri _______________________________________________ pen-l mailing list [email protected] https://lists.csuchico.edu/mailman/listinfo/pen-l
