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To: Real Man who wrote (3207)1/9/2022 9:32:33 AM
From: Sun Tzu  Read Replies (1) | Respond to of 10599
 
The repo and the reverse repo act like a dual thermostat where one heats up the economy while the other prevents over heating. The inflation would be much higher if not for the reverse repo facility.

That article made me feel much better about the the monetary tightening. When the Fed finally begins to tighten the money supply, it will hit the reverse repo before it hits the money in circulation.

As you originally pointed out, the reverse repo has partially countered the money printed, as it is meant to do. The Fed will monitor the reverse repo and will likely stop before it is too late.