Posted by WARREN MOSLER on December 24th, 2009
This is downright embarrassing:
By Liz Capo McCormick
Dec. 23 (Bloomberg) — Federal Reservetests of tri-party reverse repurchase agreements have “gone extremely well,” according to the head of the industry group working with the central bank on the transactions.
The Federal Reserve Bank of New York has drained $990 million in reserves from the banking system through five trials this month as part of its “tri-party reverse repo operational readiness program” announced Nov. 30. The central bank stressed at that time that the tests don’t represent a change in policy and were one tool at its disposal for the eventual withdrawal of the unprecedented monetary stimulus added to the economy.