Analysts from Morgan Stanley expect nearly half a trillion #dollars to leave American banks when the US Treasury goes ahead with a plan to roll out a new batch of T-bills.

Morgan Stanley is expecting $1.364 trillion of net T-bill issuance over the rest of this year, with $1 trillion of that to be issued over the next four months alone, reports CNBC.

The bank says that the new wave of US bonds will likely put significant pressure on banks who can’t compete with the government’s offered yields.

Says analyst Betsy Graseck,

“Our fixed income team sees most of this initial [Treasury General Account] restocking to come from bank reserves, suggesting ~$450b of gross outflows over the next four months.”

US bank stocks have made a notable recovery since the pain felt earlier in the year when the industry weathered the collapse of several large institutions.

According to Graseck, however, the recovery may be short lived if banks now have to deal with a tidal wave of outflows.

“A re-acceleration of deposit outflows would end the current intra-quarter bank stock bounce.”

JPMorgan analysts made a similar call to Morgan Stanley’s earlier this month, but forecasted a slightly lower number of $1.1 trillion in T-bill issuance over the rest of 2023.

Gennadiy Goldberg, a strategist at TD Securities, also recently said,

“Everyone knows the flood is coming… Yields will move higher because of this flood. Treasury bills will cheapen further. And that will put pressure on banks…

The rise in yields could force banks to raise their deposit rates.”

In a recent research note, #MorganStanley said that despite the US government’s deal to raise the debt ceiling and the stabilization in markets that followed, more volatility could be on its way. The analysts reference 2011, when markets heavily corrected shortly after the government came to a resolution on a debt ceiling crisis.

“Against this backdrop, the relative calm that pervades markets may not be sustainable. Volatility in equity, rates and credit markets appears relatively contained and well below March levels. However, looking back to 2011, markets were also calm before the X-date but subsequently registered sharp moves.

In the three weeks after the resolution, the S&P 500 fell by more than 12%, 10-year Treasury yields declined by 70 basis points (meaning prices for those securities went up) and high-yield bond index spreads widened by more than 160 basis points.”

Why does money lose its value and how to fix it?

There was a time when you had to work for months to save $1 and today's billionaires are less wealthy than the millionaires of the 19th century. For what ?

Purchasing power represents the quantity of goods and services that can be obtained in exchange for a monetary unit. In other words, it's what you can buy with 1 dollar, 1 euro, etc.

Currencies can depreciate or appreciate against each other, but they all constantly lose purchasing power against limited supply assets 💸

This is the operating principle of the current monetary system. States compete to stimulate their GDP growth, and the main drivers of this growth are inflation and the expansion of the money supply.

What do the rich do? They accumulate assets rather than cash. This is because money is constantly losing its value, which drives up the price of assets.

#Money #dollars #euro

#pepe news details :

okens like pepe 2.0, floki 2.0, and bobo 2.0 are seeing trading volumes jump to millions of dollars, attracting hundreds of thousands of dollars in liquidity and turning a few #dollars to six-figure fortunes almost overnight.

These tokens are mostly issued in the past week and are passing themselves off as new versions of the popular pepe, #floki and bobo tokens.

Anyone can call a smart contract and issue tokens on #Ethereum (or other blockchains) for a few cents, and the presence of decentralized exchanges means tokens can instantly be issued, supplied with liquidity and traded soon after.

As of Tuesday, pepe 2.0, seemingly the most popular of the clones, saw nearly $7 million worth traded in the previous 24 hours. It sported a market capitalization of $18 million, down from a peak of $45 million last week.

One wallet turned $900 of an initial pepe 2.0 purchase into over $176,000 in less than 24 hours. Analysis shows the wallet took profits on this position by selling in 2 ether (ETH) clips as the token rose.

On-chain analysis tool Bubblemaps has pointed out the centralized behavior of some early buyers who likely cornered a large part of the pepe 2.0 supply at launch and are gradually selling the tokens. That concentration may have contributed to the large price pump amid buying demand and significantly low sales from early buyers.

The real pepecoin (PEPE) is continuing to attract investors, with some large purchases extending gains of a nearly 80% rally over the past two weeks.

⚠️ Risk warning: These tokens are highly volatile and risky, and there is a high chance of losing money.

Do your own research before investing.

#crypto2023

$PEPE $BTC $BCH