A 200 trillion won liquidity surge is in the works. Something big is coming from the US | Sung Sang-hyun’s Macro Beyond, Episode 11
An independent exercise, not a statement by the video creator or verification of every claim in the video.
Reconcile a drop in Treasury cash with higher reserves
In a hypothetical Fed balance sheet, hold assets and other items fixed. If the Treasury General Account falls by 100, bank reserves rise by 100. If currency in circulation rises by 40 over the same period, the reserve gain falls to 60.
Check for yourself
- If Treasury cash fell by 100 and reserves rose by 60, which balance sheet items would you compare?
- If repo rates stayed high despite rising reserves, which settlement schedules or funding constraints would you check?
Limits of application
This is a simplified balance sheet exercise. Reserve balances and equity buying flows measure different things. Money market rates reflect the amount and distribution of reserves as well as collateral demand.
- What to look for
- See how the speaker separates earnings, valuations and short-term funding conditions when explaining a US equity selloff.
- Why it matters
- Test the liquidity hypothesis by comparing Treasury’s quarter-end cash assumptions with observed reserve balances and repo rates on matching dates.
Timeline
7 segmentsTreasury assumes different cash balances at the ends of 2026-12 and 2027-03. All else equal, a lower Treasury General Account balance can raise reserves, but actual balances also depend on Fed assets, reverse repos and currency in circulation. The speaker’s year-end and following-year outlook is conditional on these factors.