captjack 🏴‍☠️✨💜 on Nostr: ...

こんにちは、イスラム共和国日本国の友人の皆さん。あなた方の富を故郷に持ち帰って、日本を再び偉大な国にしましょう。


u can feel the fear inside his mind.

The BOJ has unlimited dollar swap lines already established with the Fed in the event its Banks need more Reserves

Instead of using these existing Swap facilities, the BOJ and Treasury recently announced the utilization of FIMA Repo

In FIMA Repo, the BOJ (temporarily) sells Treasury securities it already owns and holds in custody with the Fed, back to the Fed

This transaction provides cash to the account of the BOJ. This is not an increase in Reserve balances of commercial banks

Because this is a cash transaction there is no further intermediation required to utilize these dollars offshore if needed. No Reserves were created

On the other hand, when the BOJ utilizes Central Bank Liquidity Swaps, or its commercial Banks tap the Fed’s Standing Repo Facility, these transactions utilize Reserve Balance credits (not “cash”)

In order for the BOJ to access Reserves outside the federal reserve system it must first intermediate these funds through its Japanese private commercial banks with domestic U.S. branches.

The commercial banks receive Reserves directly in Repo and “on-loan” from the BOJ in a Swap

Then, they must create additional offshore claims with their home office Branch in Japan - “net due to Foreign Offices”, and this intrabank dollar claim can then finally be intermediated outside the Federal Reserve System

Needless to say, they are choosing FIMA repo because this nuance is important 🤷‍♂