http://www.federalreserve.gov/releases/h3/Current/

The above link from the Federal Reserve highlights the disturbing and dramatic decline in non-borrowed reserves (bank assets) from depository banks that have now become negative for the first time ever.

Last week there was talk of readjusting the reserve ratio and this may be a clue as to why that suggestion is being considered.  I'm not sure what is driving this massive decline.  Could it be the recent write downs or a major increase in bank redemptions?  Could this be why the IMF has announced it intends to sell gold and buy "high yielding financial"?

It will be interesting to see how this disturbing trend changes over the next few weeks.