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Deposits in Flow | Economy Explorer


Rashad Ahmed Let me note the following:

source: Ahmed is from FRED.

“H.8 data updated to March 15, data very clearly show ‘runs’ on small black banks. ‘Other deposits’ basically represent liquid demand deposits (total deposits minus large term deposits). “Borrowing “Represents banks in obtaining credit from institutions such as the FHLB and the Federal Reserve.

As Torsten Slok pointed out at Apollo today, funds are not only moving locations, but deposits as well.

“The difference between the fed funds rate and the checking account rate is the fundamental reason for the transfer of funds from bank deposits to higher-yielding investments, including money market accounts, see chart below. Higher interest rates as a source of instability in deposits and Treasury holdings is very unusual compared with previous banking crises, where the source of instability was typically credit losses, giving banks The illiquid aspect of the balance sheet creates downward pressure. “



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