With usage of The Fed’s emergency funding facility rising once again to a new record high last week – and banks stocks clubbed like a baby seal – all eyes are once again on just what The Fed can do to ‘seasonally-adjust’ the data to avoid the admission of any deposit run fears in domestic banks.Total bank deposits – on a seasonally-adjusted basis – crashed by a massive $83.7BN last week (the biggest outflows since SVB) to the lowest since June…
Source: BloombergNon-seasonally-adjusted, the deposit outflows were even yuuger -$129BN…
Source: BloombergIs reality starting to set in for the decoupling between massive money market fund inflows and a relatively flat deposit base for the last few months…
Source: BloombergAdjusting for foreign bank deposit flows, domestic bank deposit outflows were still massive, -$72BN SA, -$117BN NSA…
Source: BloombergTotal deposit delta since the SVB crisis are $280BN SA and $262BN NSA…
Source: BloombergOn the other side of the ledger, Large banks saw loan volumes shrink by $3.4BN while Small banks allegedly saw loan volumes rise by $3.3BN…
Source: BloombergThe key warning sign continues to trend lower (Small Banks’ reserve constraint), supported above the critical level by The Fed’s emergency funds (for now)…
Source: BloombergAs the green line shows, without The Fed’s help, the crisis is back (and large bank cash needs a home – like picking up a small bank from the FDIC)…
QT really is about to blow up another small bank…
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