Via Credit Suisse:
The Fed’s liquidity operations have not been sufficient to relax the constraints banks will face in the upcoming year-end turn. Reserves are still insufficient; there are no true “excess” reserves; and large U.S. banks’ G-SIB scores are shaping up to be a severe binding constraint heading into the year-end turn.
We have never had a year-end without a comfortable buffer of excess reserves or when G-SIB scores could force most U.S. banks to turn off market making.
