Regarding the possible resumption of bond purchases by the Federal Reserve in the future, investment banks have given a new name "Reserve Management Purchase RMP". We have previously discussed that even if the Ministry of Finance spends on TGA and the Federal Reserve stops reducing its balance sheet, it is difficult to bring reserves back to the median value of the past three years. Bank reserves are still hovering at the critical point of sufficient to sufficient, and cannot return to a state of sufficient and excess. Restarting bond purchases is imperative. This is also the case in recent months where the overnight guarantee interest rate (SOFR) between banks frequently breaks through the upper limit of the interest rate corridor at the end of the month, and the amount of SRF used has also skyrocketed. The impact was significant at the end of October and November, and there was another occurrence at the end of November and the beginning of this month https://(((x.com)))/qinbafrank/status/1995835819807096909? S=46&t=k6rimWSEbo2D2TXolYcM-A has been relieved in the past two days. In mid November, the New York Federal Reserve also held an emergency meeting, convening executives from major Wall Street banks to discuss liquidity and the use of standing repo facilities to facilitate the de branding of SRFs. So in November, New York Fed President Williams repeatedly said that bond purchases would resume soon, of course, he said this was a technical operation to manage liquidity. 1. If the Federal Reserve really starts to reserve and manage the purchase of RMP, is this a technical operation, an expansion of the balance sheet, or even what many people think is QE? Although both involve the Federal Reserve purchasing assets, there are significant differences in intention, tools, and impact. QE's main goal is to lower long-term interest rates by purchasing long-term treasury bond and MBS to stimulate economic growth. The purpose of RMP is more technical - to ensure that there is sufficient liquidity in the "pipeline" of the financial system to prevent accidents. Therefore, RMP will focus on buying short-term treasury bond (T-bills), and its overall impact on market interest rates should be more neutral. My personal opinion is that purchasing RMP through reserve management is not QE, but it is already an expansion of the balance sheet. Previously, here was https://((x.com))/qinbafrank/status/1845662383496413292? S=46&t=k6rimWSEbo2D2TXolYcM-A has discussed the difference between QE and table expansion. After all, the balance sheet needs to be expanded. Previously, Dario was here at https://((x.com))/qinbufark/status/1987117519685959954? S=46&t=k6rimWSEbo2D2TXolYcM-A is more direct, no matter how it is packaged (whether it is technical operation or RMP), as long as it is a bond purchase, it is considered loose. 2. When will the Federal Reserve restart bond purchases (mainly short-term bonds)? My previous expectation was either to announce it at the December meeting or to push it to January next year. Looking at the predictions of various institutions on Wall Street, they all believe that there is a high probability of announcing at the December meeting that action will begin in January. Evercore ISI believes that the Federal Reserve may need to purchase an additional 100 billion to 150 billion dollars of short-term treasury bond bonds at one time in the first quarter to quickly replenish reserves. The gap amount required to return the reserve to the median value of the past three years, as calculated by me in mid November, is very consistent. Based on the analysis of various institutions, the Federal Reserve needs to net buy more than $20 billion per month. Of course, the Federal Reserve also has other tools, such as the Standing Repurchase Facility, which is highly stigmatized. Many institutions are unwilling to use it. So the easing of interbank liquidity tension has an effect, but the effect is not significant. Now this is still speculation and expectation, and more importantly, it depends on how the Federal Reserve guides and operates next week. This article is sponsored by the meme trading tool http://(xxyy. io) | Fast trading, versatile features, and can be used to monitor on chain wallets @useXXYYio