The Fed Will Own Majority of MBS and LTB By 2015

[FaninAma]

MBS=Mortgage Backed Securities
LTB= Long Term US Bonds or Treasuries

Their balance sheet will also account for 30% of the GDP.
And remember this is a private corporation that can't be audited.
Forget Democrats and Republicans this is who really runs the country .
http://www.zerohedge.com/news/bofa-sees-fed-assets-surpassing-5-trillion-2015-leading-3350-gold-and-190-crude

[soonercruiser]

And, how much are those worth?
Will that be eventually be tied to our economy or the national debt?
When will the bills come due?
How much time do WE have?

[SoonerorLater]

The Fed Bazooka

Given our growth forecast, we expect the Fed to follow up the expiration of Operation Twist with an open-ended outright Treasury purchase plan at the December meeting. We expect the pace could be between $45 billion (which would be equal to the current size of Twist) and $60 billion/month for two years [in 10 year equivalents]
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This is the most horrible situation that few people are talking about. Just out and out monetization. These financial alchemists at the Fed are just bound and to determine to devalue the dollar. Because of their hubris they think they can surgically pull off a soft default. In my estimation it won't work like that. A stampede out of the dollar is the most likely result. I don't even want to think about the flood of foreign dollars that would come home to roost.

[pphilfran]

The Fed Bazooka

Given our growth forecast, we expect the Fed to follow up the expiration of Operation Twist with an open-ended outright Treasury purchase plan at the December meeting. We expect the pace could be between $45 billion (which would be equal to the current size of Twist) and $60 billion/month for two years [in 10 year equivalents]
-----

This is the most horrible situation that few people are talking about. Just out and out monetization. These financial alchemists at the Fed are just bound and to determine to devalue the dollar. Because of their hubris they think they can surgically pull off a soft default. In my estimation it won't work like that. A stampede out of the dollar is the most likely result. I don't even want to think about the flood of foreign dollars that would come home to roost.

No one is going to stampede out of the dollar when the dollar is best of the worst...

The last one spending is going to be screwed...and imo it looks like the Euro folks are the ones bending over and lubing up...

[FaninAma]

The Fed Bazooka

Given our growth forecast, we expect the Fed to follow up the expiration of Operation Twist with an open-ended outright Treasury purchase plan at the December meeting. We expect the pace could be between $45 billion (which would be equal to the current size of Twist) and $60 billion/month for two years [in 10 year equivalents]
-----

This is the most horrible situation that few people are talking about. Just out and out monetization. These financial alchemists at the Fed are just bound and to determine to devalue the dollar. Because of their hubris they think they can surgically pull off a soft
default. In my estimation it won't work like that. A stampede out of the dollar is the most likely result. I don't even want to think about the flood of foreign dollars that would come home to roost.

You will know the end is near when the Fed finds a way to openly purchase stocks in the equity markets.....although other central banks have been doing this for a while now.

[pphilfran]

You will know the end is near when the Fed finds a way to openly purchase stocks in the equity markets.....although other central banks have been doing this for a while now.

Ain't gonna happen

[FaninAma]

No one is going to stampede out of the dollar when the dollar is best of the worst...

The last one spending is going to be screwed...and imo it looks like the Euro folks are the ones bending over and lubing up...

They may not buy other currencies or currency based instruments but I bet they buy hard aseets including gold, silver, agricultural products and land. I am willing to bet water rights become a valuable commodity in the very near future.

[FaninAma]

Ain't gonna happen
Care to give us your reasons? The Fed isn't supposed to monetize the US debt either, but they have found a way around this little requirement in their charter.

And other central banks are already buying equities.
http://www.reuters.com/article/2012/10/09/us-monetary-investment-idUSBRE8980S920121009

[FaninAma]

Delete.

[SoonerorLater]

They may not buy other currencies or currency based instruments but I bet they buy hard aseets including gold, silver, agricultural products and land. I am willing to bet water rights become a valuable commodity in the very near future.

That's one of the things about currency debasement, you can't really control where the money will flow to. Sometimes the inflation is pretty asymmetrical. I would think all of the above you mentioned would be better than holding dollars.

[pphilfran]

Care to give us your reasons? The Fed isn't supposed to monetize the US debt either, but they have found a way around this little requirement in their charter.

And other central banks are already buying equities.
http://www.reuters.com/article/2012/10/09/us-monetary-investment-idUSBRE8980S920121009

Reason? Just don't think they will...

[Bourbon St Sooner]

I don't think the Fed needs to directly buy equities. The liquidity they keep pumping out there does a good enough job of inflating the equity bubble.