The Macro Tide · plumbing Fed H.4.1, as of 2026-08-26

Where the liquidity actually sits

The Fed's balance sheet must balance: its $6.73T of assets equals its liabilities. "Net liquidity" and "reserves" are just two different slices of the same bar — here's how $5.78T and $2.92T both come from one picture.

The $6.73T bar, split by where the cash goes
Total Fed assets (WALCL) $6.73T — every dollar shows up as a liability below
Currency + other$2.85T
Bank reserves$2.92T
TGA$0.95T
Net liquidity = WALCL − TGA − RRP = $5.78T · in the system
Sterilized $0.95T · locked away
Currency (~$2.4T, inert) + other Reserves — the operative liquidity TGA — Treasury's cash ON RRP ≈ $0 (drained)
WALCL $6.73T = Currency+other $2.85T + Reserves $2.92T + TGA $0.95T + RRP ~$0
Net liquidity = WALCL − TGA − RRP = $5.78T ( = Currency+other + Reserves )

So $5.78T and $2.92T don't conflict — they're different slices. Net liquidity is the broad tide: everything except the two sterilized buckets (the Treasury's account and the RRP parking lot). But it still counts currency in wallets (~$2.4T), which is inert for markets — so reserves ($2.92T) is the sharper number: the actual cash banks use to settle payments and fund the repo market.

The three plumbing gauges, on the bar
ON RRP$0.5bn

The money-fund parking lot. Was $2.2T in 2022–23; drained to ~zero as cash moved into T-bills. The buffer is gone — further QT now hits reserves directly. wk Δ ≈ 0 (noise)

Reserves$2.92T

Bank cash at the Fed — the operative liquidity. The "comfortable floor" is ~$2.5–3T, so we're near the zone the Fed watches. This is why QT is ending. near floor

SOFR − IORB−1 bp

The stress tripwire. SOFR (repo rate) vs IORB (what the Fed pays banks). When reserves get scarce, SOFR pushes above IORB (2019 spiked +300bp). −1bp = calm. no stress

The punchline: the tide looks fine ($5.78T net), but the buffer is gone (RRP ≈ 0) and reserves ($2.92T) sit near the comfort floor — so the system is one QT-overshoot from funding stress, and SOFR−IORB (calm today) is the tripwire. That's the daily read our weekly net-liquidity tide alone would miss.