On December 1, 2025, a severely underestimated historical moment quietly arrives.

The Federal Reserve has crossed that line. Quantitative tightening has officially ended. The balance sheet is locked at $6.57 trillion.

In the past two years, the Federal Reserve has withdrawn $2.39 trillion from the market— the most severe liquidity contraction in human history. What’s the result? The system has not become more stable; instead, it has completely exposed the underlying cracks.

What happened next is even more intriguing:

The $2.5 trillion buffer funds in the reverse repo tool? Almost depleted. Bank reserves have fallen to $3 trillion—this figure has already crossed the warning line. The Treasury bond market is starting to misbehave, and the SOFR rate has skyrocketed. Even more exaggeratedly, the Fed's "crisis-use only" standing repo facility (SRF) has now become a daily necessity.

What does this mean? The Federal Reserve is essentially saying to the market now:

"Don't panic, you can always exchange the government bonds in your hands for cash. I guarantee it."

They are no longer the "lender of last resort". They are the "lender of every night".

The old game rules are completely scrapped.

This is not a policy adjustment. It is the underlying logic of the monetary system being rewritten. In this new system, the U.S. government has to seek "lifeline" from the Federal Reserve every day just to prevent the Treasury bond market from collapsing.

Think about it: can a currency system that needs to be rescued every 24 hours still be called a "system"?

That's called ICU.

However, speaking of which, the old has collapsed, which also means the new has arrived...