This means that, if going solely by the amount of securities submitted between the term and overnight repo, the overall liquidity shortage today was nearly $180BN, the highest since the start of the repo crisis, and a clear signal to the Fed that it needs to do something to further ease interbank lending conditions.

It did not take long for shock and awe of last week's market turmoil to hit the interbank market.

One day after the overnight general collateral repo rate unexpectedly soared to 1.80%, far above the effective Fed Funds rate, and an indication that last week's record market drop was once again causing interbank liquidity plumbing to clog up as banks had to pay far higher market rates to obtain overnight liquidity as the Fed's monetary policy was once again not making its way to the repo market...