system
A chat on subreddit /r/wallstreetbets
human
I thought a repo was a cash loan to a bank to allow them to meet their cash reserve requirements. The loan is backed by a treasury the bank owns...meaning that the treasury is collateral, and that  the banks would rather hold the treasury than sell it to create cash.

gpt
Ya I probably wasn't clear but they don't literally purchase it. As you say it's a loan with the treasury as collateral