All holders of MBS receive pass-through principal payments when the underlying mortgages are paid off, either when the home is sold or the mortgage is refinanced, such as during the current refinancing boom. Wolf – Thanks very much for doing all of this. Establish oligopoly or preferably monopoly. 7 trillion. The whole system is corrupt beyond believe. Because the Fed says there are no asset bubbles. Housing Bubble 2 Step4. Profit above all. ‘.. as the Fed as allowed some of its assets to unwind (QE unwind) and the economy continued to grow’. Leary of Incapital says he pulled back on the popular trade to take profits in early November, when the 10-year Treasury yield approached 1%, and positioned instead for more flattening. William L. Anderson,: On the one hand, they can signal greater confidence in the recovery and, indeed, officials might even welcome them if they’re accompanied by rising inflation expectations. Eventually prices will increase to match (most likely more than match) any minimum wage increases. Then one thinks, the SNB just cannot go wrong. The macro highlight of the week ahead is the Federal Open Market Committee’s policy decision on Wednesday. Stay here, read and learn. From the initial rate cuts and emergency aid programs of March to its decision to place inflation at the heart of its monetary policy, the central bank has taken a proactive approach, with officials reiterating their sensitivity to markets. Maybe that will wake someone up. They’ve got plenty of “mutations” up their sleeves. All … But of course that goes against their philosophy of economic growth driven by binging on credit so it’s not going to happen. Certainly, we are the most liquid, Chairman Powell take a bow. Don’t get me wrong it could happen and I hope it does just stop the scam. There is NO Nobel prize for Economics!!!!!!!! It’s just another Social Science. Those swaps have maturities, and nearly all of them have matured and were unwound, when the Fed got its dollars back, and the other central banks got their currencies back. However, this will increase inflation expectations and drive long rates up. Exactly! I save more money by going to the Supermarket when they reduce the food because of getting close to the “sell date” than the return I would get on a $500,000 bond paying 0.1% interest with no risk to the capital. “until we have folks in there to represent .. That will Only happen AFTER the whole damn Republic collaspses from all the grift and fraud weighing it down. The Fed buys large amounts of MBS in the “To Be Announced” (TBA) market, to replace the pass-through principal payments and then to increase its balance. They changed in only the past few years. They’re separate legal entities (LLCs) that the Fed created with the help and equity funding from the Treasury Department. And the rates looking “under control” creates a desire for more spending. Wouldn’t be very popular with the shmucks and politicians though. An end to the crisis is what everyone fears. Also yesterday people were only allowed to SELL. And maybe someone could come up with a glossary including acronyms? In a dis-inflationary environment the central ban can do what they want. Anyway I am back to 90% or so money market and short term us treasury fund slowly trying to get a little gold and silver exposure in case the Fed does whatever it takes and if you are doing the wrong thing it’s never enough. I think she is shouting down a well, the challenge for the Fed if they continue to prop up the macro system is to bring marginal entities under regulation. It is so far beyond even the teeny tiniest shred of credibility to suggest in anyway that we have no inflation or too low inflation and maybe to even think inflation isn’t approaching double digits, or more. If you studied geometry in High school you may remember the parabolic curve, which is what is happening to the balance sheet of the Fed and the Federal deficit. Though the SPVs are gone, the Fed can resurrect them in no time, whenever there is a threat of true price-discovery. Therefore, I see a substantial tail risk for much higher yield increases than most people are now anticipating. [33] He explained that “Nobel despised people who cared more about profits than society’s well-being”, saying that “There is nothing to indicate that he would have wanted such a prize”, and that the association with the Nobel prizes is “a PR coup by economists to improve their reputation”. JP can’t tell us the truth because it would crash the markets. Yesterday at Powell’s press conference: Japan tried for over 2 decades! They pretend there is not inflation for one reason only: They get to give free money to their rich and and themselves. The Fed will then be in a very difficult position, but they will be forced to fight the inflation, otherwise the debt becomes unsustainable: Higher inflation still takes ages to make a dent in the debt, but the (re-)financing costs of the debt will immediately jump up, causing even bigger deficits, cause even bigger yield rises (because that is the dynamic once inflation takes hold). Of course the Fed will be behind the curve, and investors understand that and this raises inflation expectations even more. With market expectations for Fed action tamping down yields, traditional signals sent by those rates have become less reliable for interpreting investor sentiment. “Stimulus” has gone completely ape-shit and everybody now expects stimulus checks and other massive deficit spending. Nietzsche had his own problems, just like many of his true believers who think hey are more intellectually elite than other.wise men. Short selling is a finance practice in which an investor, known as the short-seller, borrows shares and immediately sells them, hoping to buy them back later ("covering") at a lower price.As the shares were borrowed, the short-seller must eventually return them to the lender (plus interest), and therefore makes a profit if … People who are under these constraints are not going to look kindly on some hamburger flipper making $15/hour while they have put 30 years into their careers and have graduate school level education are busting their butts working 18 hours/day making the same amount. Plus, It’s a hell of a lot easier to print money than it is to raise taxes. Companies & Markets the yieldcurve steepens. The casino action in money leads to casino action in stocks. One thing never talked about is the fact that a lot of jobs are under wage controls, or fee controls. Make a lot of money. FED have pattern – print make bubble than stop, rinse and repeat –but problem is bubble are getting bigger. Stocks and bonds need nary an excuse to find price levels much, much lower. Neither assets nor GDP (nominal GDP) are adjusted for inflation. In emergencies, somewhat warranted. Taxes are there to reduce liquidity. I think it 800k for her wit and wisdom. historic, but where is it written that it is a mandate for any central bank to be manipulating financial markets through purchases of $Trillions of equities, the security last in line with no backstops during bankruptcy??? Martha, not with a steepening of the Yield Curve due to a surge in Inflation Expectations ignited by a Fed & Government running wild with money creation and Currency Devaluation. But Goldman Sachs Group Inc. has shifted to a more nuanced view, targeting a steeper curve via forward contracts instead of spot positions. Rising CPI inflation, rising yields, credit risk fears and falling asset prices in the coming years. The Federal Reserve buys and sells Treasury bonds as part of its work to control the money supply and set interest rates in the U.S. economy. printing more money) just fuels inflation even more. If the long end of the yield curve rises too much, they will first try yieldcurve control to push it lower, but that will only work as long as inflation doesn’t really take off. ‘inflation and economic growth will make their balance sheet smaller over the years relative to the economy’. All this means more money in the hands of people who’s expenses actually increase the CPI. You can make 37 basis points in a matter of minutes if you just put that cash into the stock market on a good day. Has it occurred to Powell, Yellen, and Co that AI bots could replace them at Fed policy and no one would notice? Out of control inflation would crush the economy and hence the tax base. (Head bang #n). The Fed has been adding to its pile of Treasury securities at the rate spelled out in its FOMC statements, thereby monetizing part of the US government debt”. The current bunch of blu ishmonkeys/redrHinos hold the broom ..worn, and bare of any cleansing bristles .. like any good coven! With minimum wages set to rise, this will also trigger demands for higher wages further up in the chain. Which is hard to understand because watching DW and BBC it appears they are now just as “owned” as the American media.   It's crucial to remember that yields go down when there is a lot of demand for the bonds. Europe’s Dilemmas Place bets. The entire global system is a single entity now, and as such they would most likely need to be coordinated on a global scale to keep the system balanced and semi-stable. Such a move could cement the theory that the Fed will not allow negative interest rates…that is unless they get forced via a future unexpected crisis. They’re now around 0.9% -- despite similar-maturity breakeven rates continuing to rise as stock and metals markets price in reflation. You would think that the Swiss Franc would be falling against the US Dollar but that is not the case. A.K.A., banks. We’re well on our way towards the same fate as Weimer Germany. And this expectation by itself already works as a kind of backstop. A billion seconds is 32 years. Its no longer linear. That creates upward pressure on the federal funds rate, since banks have fewer reserves available to lend and will charge more to lend them. Nobel prize for Economics!!!!!!!!!!. Over a month with 30,000 pieces of mail inside seen in the Wall Street that them... It back in the U.S. Department of the government securities it holds buyers... Unrest like what happened last summer without crushing the global economy with many negative. Often extoled mobility as the American media are gratefull for a currency and the outcome would still be everywhere... 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