On 17 September 2019 the overnight repo rate spiked toward 10% while the Fed's target was around 2%. Nothing had defaulted. The plumbing had simply run dry.
On the morning of 17 September 2019, banks and dealers who normally borrow overnight against Treasury collateral at around 2% found themselves paying rates that touched roughly 10% intraday. No institution had failed. Corporate tax payments had drained cash, a large Treasury settlement had absorbed more, and bank reserves had been ground down by years of balance sheet runoff. The Fed restarted repo operations within a day.
— Educational, not financial advice.