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🔄 The Repo Playbook: How Wall Street Borrows with a Promise to Return
Imagine this: You lend your friend your favorite watch for a week. In return, they give you cash and promise to return the watch with a small thank-you gift $($interest$)$ next Friday. That’s basically how a repurchase agreement (repo) works — but with bonds instead of Rolexes. Let’s explore the mechanics, motivations, and risks of…