See, the whole window dressing phenomenon in itself is worrying. Why this need to cook the books at cycle ends? It reeks... Yeah "its the rules that's wrong" or something is what follows this as a reply, I'm sure, but is that truly the case? Should we all just accept that banks are "dressing up the balance sheets" and the feds are aiding that process? A functioning bank with no concerns shouldn't have to fiddle around like that simple for nicer looking numbers. Smells like a malpractice honestly, though I am aware it is "usual procedure". Also, the amount borrowed from the treasury is the largest in several years. If there's no need explanation other than the usual "oh it's normal they're just cooking the books because that's what they always do", then why the record breaking number? At which point would we consider the amount borrowed from the lender of last resort as something worrying instead of just brushing it off as "business as usual"?
Discussion
I totally agree that this seems like people accepting the unacceptable. You shouldn’t have to dress things up at quarter/year end. That they have to is worrying, but this is not new so we shouldn’t expect the world to explode weeks after this happens again for the millionth time. The system rigged and crooked and fragile, but this indicator isn’t signal.
You're right, though, that we shouldn't put too much into this, I'll give you that. It's been accepted for a while and even though the amount is larger than usual this time, I have to agree we probably can't assign it with any particular impending collapse.
If the amount had been borrowed outside of the cycle ends, or we saw several consecutive days of borrowing of this magnitude, I think we should start preparing for a scenario not too far into the future where banks would collapse.
I was being a bit too frantic in that first comment, for sure.