(it's all about me)
From FT Alphaville:
When unsecured is cheaper than secured borrowing
A strange thing is happening in money markets: the cost of borrowing unsecured wholesale funds is now below the cost of borrowing secured funds.Here is the official Macmillan "Alice" website, rather amazing.
The problem, according to repo dealers, is that new leverage ratio rules are set to make it far too costly for repo market participants to transact.
Meanwhile in the world of swap spreads, as Bloomberg’s Tracy Alloway has been noting, rates have plummeted to historic negative lows which defy market logic.
But it’s not just that. Cash bond-futures basis and some cross-currency basis spreads have been acting pretty weird too.
According to some market specialists, the real concern is Basel III’s upcoming implementation of the net stable funding ratio (NSFR), before 2018.
This is a forward-looking one year measure of bank liquidity, which is supposed to incentivise banks to reduce reliance on short-term funding. All of which means… it could soon become counterintuitively pricey to offload short-term liquidity into the market because of the effective penalty associated with taking it on....MORE
And from the Lewis Carroll Society:
The Works of Charles Dodgson: Alice
...The book was published on commission by Macmillan & Co., in July 1865, in an edition of 2000 printed by the Oxford University Press, the copies to be bound in red cloth gilt. Only 50 copies had been bound when Dodgson heard from Tenniel that he was dissatisfied with the way the pictures came out. The book was withdrawn, and recipients of presentation copies asked to return them. The rejected copies were presented to children’s hospitals and institutions – 23 copies of the ‘1865 Alice’ are known to have survived. (See reference 1.)In November 1865, the second edition of 2,000 copies was published, using a new printer (Richard Clay of Bungay) (See reference 1A). The new edition was said by Dodgson to be a ‘perfect piece of artistic printing’....