The Federal Reserve Bank of New York’s operation to inject cash into the financing system over the end of the year was undersubscribed on Thursday, a possible indication that dealer balance sheets are nearing capacity. Primary dealers submitted $18 billion in bids for the Fed’s 14-day term repo operation, which matures Jan. 9. That was less than the $35 billion on offer. This is the third term operation aimed at year-end funding that has come in under the maximum amount. Thursday’s result could mean either that dealer balance sheets are approaching capacity, or that those who need funding for year-end have secured ... (full story)