$MIKO
Fading QuicklySnapshot Window: 2026-07-24 17:10 UTC · ← Back to Crypto Overview
Social Momentum Summary
Total Engagement - Comments: 161, Retweets: 84, Likes: 152, Impressions: 1651
Verbatim Community Citations & Social Evidence 1 source posts analyzed
basis trade is a perennial “financial stability risk” at the Fed. yet when you told regulatory hawks (democrats) that allowing banks to hold more UST would *help*, they panicked that you’d cause the next GFC. turns out, too much regulation is a negative for financial stability.
AI visual note: The image is a Bloomberg AI summary titled "Basis Trade, Hedge Funds' Favorite US Bond Bet, Is Sputtering," reporting that hedge funds' leveraged basis trade in US Treasuries is losing momentum as futures-cash spreads narrow, with leveraged capital deployed in the trade declining by over $200 billion to $1 trillion per Morgan Stanley estimates, partly due to Wall Street banks increasing Treasury holdings. This supports the post's point: regulatory constraints that prevented banks from absorbing more Treasuries helped fuel the crowded basis trade—now that banks are increasing their UST holdings, the leveraged hedge fund trade is shrinking, illustrating how overregulation paradoxically created the very financial stability risk it sought to prevent.