by Dave Kranzler, Investment Research Dynamics:

Liquidity in the primary dealer Treasury market is drying up.  Deposit outflows from the big banks continue unabated. The outflows at the small, regional banks haveg abated but some banks continue to draw on the Fed’s Bank Term Funding Program, which hits a new high almost weekly. The facility matures in March but it’s doubtful the debtor banks will be in a position pay back the loans. Just like the “temporary” repo program that began in September 2019, the BTFP will continue to hit ATH’s and the Fed will extend the maturity of the facility. This is de facto QE.