Monday, September 23, 2013

LET'S KEEP THAT DEBT A-GROWIN'

According to Ben Bernanke, the Fed will continue to buy $40 billion in mortgage-backed securities (MBS) and $45 billion in U.S. Treasury securities per month.

Since the beginning of September 2008... the Fed's ownership of Treasury securities and MBS has increased seven fold.

As of the close of business Thursday, the Fed said, it owned approximately $2,052,055,000,000 in U.S. Treasury securities and approximately $1,339,771,000,000 in mortgage-backed securities—for a combined total of about $3,391,826,000,000 in Treasury securities and MBS.

Thus the Federal Reserve now owns more debt in the form of U.S. Treasury securities and MBS than the publicly held debt the U.S. government accumulated from George Washington’s administration into November 2001, during President George W. Bush’s first term.

So, is there any limit? Any at all?

5 comments:

Xavier Onassis said...

You seem to imply that some sort of harm is being done. Perhaps you'll enlighten us and tell us, specifically, what harm is being done and to whom?

Duckys here said...

Well it's pretty obvious, XO.

1. Allow the banking system to stagnate and the economy to contract.

2. Buy the debt obligations when the rising, slowly albeit, housing market allows you to realize a profit and borrow money at interest below the inflation rate.

Now really, which is a good Calvinist like Joe going to pick?

Xavier Onassis said...

I'm sure any similarities (such as word for word verbatim cut-and-paste theft as well as photos) between Joe's post and this story (http://cnsnews.com/news/article/terence-p-jeffrey/339t-quantitative-explosion-fed-owns-more-treasuries-and-mbss) are a complete coincidence and not just laziness.

Joe said...

XO: "Perhaps you'll enlighten us and tell us, specifically, what harm is being done and to whom?"

No. I don't think I will.

Ducky:"...a good Calvinist like Joe..."

That I ain't.

XO: "... any similarities"

I could have just re-written it in my own words and provided no links, and you would never have known.

Wow! You're just too suave to fool!

sue hanes said...

Joe - It appears that there isn't -none at all.