How Hedge Funds Are Shorting the Fed Plumbing Trade

The Fed's reverse repo facility has fallen to zero and the reserve supply is swelling past $3.3 trillion. Lucas and Luna dig into the 'dealer balance sheet constraint' trade that hedge funds are quietly piling into: shorting Treasury futures and going long cash bonds, exploiting the plumbing mismatch the Fed created with quantitative tightening unwinding. They walk through why the trade works, what Kevin Warsh's real 'regime change' means for funding markets, and how the spike in SOFR repo rates in April tipped off the smart money. Plus: why this isn't the same basis trade that blew up in 2019. #HedgeFunds #FedPlumbing #ReverseRepo #BasisTrade #TreasuryFutures #SOFR #RepoMarket #QuantitativeTightening #KevinWarsh #WallStreet #Finance #Investing #AlternativeInvestments #FixedIncome #Liquidity #FexingoBusiness #BusinessPodcast #TheHedgeFundPodcast Keep every episode free: buymeacoffee.com/fexingo