Exclusive: The Fed's Term Deposit Auction Appears Ready to Go Live

A new method for the Fed to drain money from the system (and also divert it back in, if needed), through Term Deposit Auctions, appears ready to go live online. Bob English at EPJ discussed Bernanke's latest tool, here.

The Fed seems to want to get all banks online with this system, so while the Fed may be doing some testing, it appears that they will also have the entire system ready to employ  on short notice.

Michael Dunton, Senior VP at Mt McKinley bank reports:

This [term deposit auctions] appears to be getting closer to going online as the FRB has been prodding banks to get signed up. The SF-FRB RM told me today that they are just waiting on the FRB-BOG to give the final ok.