by David Haggith, Gold Seek:

Two red lights flashed in the world of central banks—one at the US Federal Reserve and one at the Reserve Bank of India.

You’ve heard me refer back to the repo crisis of 2019, which forced the Fed to leap back into doing massive quantitative easing (money “printing”) to replenish cash reserves in banks after they took their balance-sheet reserves down further than the banks could handle.

Repo loans are overnight loans banks take out from other banks to reconcile their accounts at the end of the day if they are short on cash to cover all the checks and debits that came through due to getting too many withdrawals and/or not enough deposits. Normally, banks use Treasuries from their own reserves as collateral to trade with other banks for cash at very low interest rates due to the collateralization in US Treasuries.