Ok listen up faggots, Lots of boomer sympathizers sucking the old guys dicks today over new ATH.

Let me give you the 411

The repo markets, "da fuq is dat shit I cant even read dat nigga im legally retarded" an anon might say. Well, bassically banks put up collateral of less liquid loans to get a short term loan to operate with, this collateral can be anything and often times it's lent out multiple times in a fractional method. Let me explain for you Nigerians

So yah nigga Jamal bought 4 crack rocks last week, Jamal only sold 2 of those crack rocks this week tho cause tenequia overdosed and is still in the hospital. His supplier lil Jenashuan though has a deal with him, if he buys 4 crack rocks every week then Jamal gets the good rocks u know. So Jamal goes to his other nigga Tarazan and says "Tarzan, if I give you these 2 crack rocks then you give me $50 so i can buy 4 crack rocks, and when I sell two more crack rocks after tenequia gets out of the hospital I'll pay you $55 to get those two crack rocks back"

So Tarzan cant even do math but hes like fuck yeah I get $5 for free, here you go Jamal heres 50 bucks. After jamals gone though Tarzan realizes he aint go no money for no drank, so tarzan goes to lil Jenashuan and says "look dude, I'll give you one crack rock if you give me 25 dollar right now muthafucka, and then when Jamal pays me back I'll pay you $27.5 dollars for that crack rock back"

Jenashuan is a bizness man, so Jenashuan says "aight blood deal". Now later that night Tenequia gets out of the hospital and is fiendin, so Jamal sells her the two cracks rock. He goes back to Tarzan and pays him $55, then tarzan goes to Jenashuan and pays him 27.5, then tarzan has his two crack rocks back and gives them back to Jamal. You niggers get this?

Now, Jamal thinks this is a good racket and does this to keep his tight re-up schedule. One day though Jamal gets some dirty crack rocks, aint nobody wanna smoke these bitches.

So Jamal does his usual deal, both tarzan and Jenashuan do their deal as well. Everybody has some of the crack rocks. Then they realize these crack rocks are diry as fuck cuz. Jamal is thinking "fuck my nigga I dont have $55 to pay for those bitches back cuz aint nobody gonna buy em", and tarzans thinking "fuck blood Jamal aint gonna pay a nigga back so I'm just not gonna buy my crack back from Jenashuan you feel"

Now the market has broke down and the Central Gang Banging Open Commite has to give out free money to all of them so they can keep buying and selling crack.

End of story. Now replace crack with Subprime mortages and suddenly you understand why the repo market melted down in 2008. Replace the crack with "Investment grade corporate bonds" and you understand why the market will melt down late 2019-early 2020. Hope you niggers learned something

Jamal is the buisness who is making money off the actual asset not the spread. Tarzan would be a dealer or bank who is holding that security and charging a .5% spread on the loan, Jenashuan would be another bank or the fed who is also charging a spread on the loan. Jamal makes money when the assets appreciate to maturity, tarzan and jeshuan make a small bit of money by loaning to Jamal until his assets appreciate, so Jamal doesnt face cashflow problems with long dated maturity assets.