[GUEST ACCESS MODE: Data is scrambled or limited to provide examples. Make requests using your API key to unlock full data. Check https://lunarcrush.ai/auth for authentication information.]  EndGame Macro [@onechancefreedm](/creator/twitter/onechancefreedm) on x 39.7K followers Created: 2025-07-18 21:26:35 UTC People hear about the Fed holding rates steady or waiting to cut, but what they miss is the quiet tightening that’s happening deep in the financial system in the actual plumbing that keeps money flowing between banks, businesses, and consumers. Think of the banking system like a giant network of pipes. At any given time, banks need a certain amount of water (cash, liquidity) flowing through those pipes to keep things functioning smoothly. If deposits start drying up, if cash reserves shrink, or if banks have to start borrowing just to keep their heads above water, that’s a sign the system is getting stressed, even if nothing has broken yet. And that’s exactly what we’re seeing. From March to June, the total amount of lending in the banking system dropped from $XXXXX trillion to $XXXXX trillion, that’s $XXX billion less credit being extended. And it’s not being reallocated to new growth either, business loans barely moved ($2.74T to $2.75T) and real estate loans didn’t grow at all. That tells us banks aren’t just being cautious, they’re pulling back. At the same time, banks sold off around $XXX billion in government bonds, shrinking their holdings from $4.00T to $3.85T. When banks sell Treasuries like that, it usually means they’re trying to raise cash fast, either because they’re nervous about risk, or because they’re losing deposits and need liquidity. But even that hasn’t stopped the squeeze. Cash reserves, the water in the tank, dropped by $XXX billion over those same months ($3.47T to $3.12T). And deposits fell another $XXX billion ($17.23T to $16.90T). So not only is the water in the pipes flowing out, but the refill valves are getting turned off. And to keep things from seizing up entirely, banks have had to borrow more, up from $420B to $445B. This is the Fed’s plumbing in motion. When Powell says he’s keeping rates steady, it sounds like nothing is happening. But in reality, the system is slowly bleeding out liquidity. Not all at once, but through a steady drip across cash, deposits, and bond portfolios. That’s a form of tightening all by itself. It’s also exactly what the Fed wants, until it doesn’t. If these trends continue, the stress will build. Maybe not enough to crash anything, but enough to force action. Before the Fed cuts rates, it might start slowing down its balance sheet runoff (QT), or step in with repo operations, short-term cash injections, to keep the pipes from drying out. Liquidity is quietly tightening beneath the surface, and while there’s no immediate crisis, the system is under growing pressure, setting the stage for the Fed to shift course if the strain continues.  XXXXXX engagements  **Related Topics** [united states](/topic/united-states) [banking](/topic/banking) [money](/topic/money) [rates](/topic/rates) [fed](/topic/fed) [federal reserve](/topic/federal-reserve) [endgame](/topic/endgame) [Post Link](https://x.com/onechancefreedm/status/1946320719668822494)
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EndGame Macro @onechancefreedm on x 39.7K followers
Created: 2025-07-18 21:26:35 UTC
People hear about the Fed holding rates steady or waiting to cut, but what they miss is the quiet tightening that’s happening deep in the financial system in the actual plumbing that keeps money flowing between banks, businesses, and consumers.
Think of the banking system like a giant network of pipes. At any given time, banks need a certain amount of water (cash, liquidity) flowing through those pipes to keep things functioning smoothly. If deposits start drying up, if cash reserves shrink, or if banks have to start borrowing just to keep their heads above water, that’s a sign the system is getting stressed, even if nothing has broken yet.
And that’s exactly what we’re seeing.
From March to June, the total amount of lending in the banking system dropped from $XXXXX trillion to $XXXXX trillion, that’s $XXX billion less credit being extended. And it’s not being reallocated to new growth either, business loans barely moved ($2.74T to $2.75T) and real estate loans didn’t grow at all. That tells us banks aren’t just being cautious, they’re pulling back.
At the same time, banks sold off around $XXX billion in government bonds, shrinking their holdings from $4.00T to $3.85T. When banks sell Treasuries like that, it usually means they’re trying to raise cash fast, either because they’re nervous about risk, or because they’re losing deposits and need liquidity. But even that hasn’t stopped the squeeze.
Cash reserves, the water in the tank, dropped by $XXX billion over those same months ($3.47T to $3.12T). And deposits fell another $XXX billion ($17.23T to $16.90T). So not only is the water in the pipes flowing out, but the refill valves are getting turned off. And to keep things from seizing up entirely, banks have had to borrow more, up from $420B to $445B.
This is the Fed’s plumbing in motion. When Powell says he’s keeping rates steady, it sounds like nothing is happening. But in reality, the system is slowly bleeding out liquidity. Not all at once, but through a steady drip across cash, deposits, and bond portfolios. That’s a form of tightening all by itself.
It’s also exactly what the Fed wants, until it doesn’t. If these trends continue, the stress will build. Maybe not enough to crash anything, but enough to force action. Before the Fed cuts rates, it might start slowing down its balance sheet runoff (QT), or step in with repo operations, short-term cash injections, to keep the pipes from drying out.
Liquidity is quietly tightening beneath the surface, and while there’s no immediate crisis, the system is under growing pressure, setting the stage for the Fed to shift course if the strain continues.
XXXXXX engagements
Related Topics united states banking money rates fed federal reserve endgame