Kevin Spires, CFA, FRM
The Federal Reserve releases an accounting of its Balance Sheet every Thursday. The Fed's Balance Sheet has tripled in the past four years - although it has been stable for the past 12 months. Most of the Fed's Balance Sheet is now Treasury Securities or Agency Guaranteed Securities (Both Mortgage Backed Securities ie.MBS and Straight Debentures).
The Federal Reserve releases an accounting of its Balance Sheet every Thursday. The Fed's Balance Sheet has tripled in the past four years - although it has been stable for the past 12 months. Most of the Fed's Balance Sheet is now Treasury Securities or Agency Guaranteed Securities (Both Mortgage Backed Securities ie.MBS and Straight Debentures).
It will be interesting to see if the Fed returns its Balance Sheet to the long term trend - which would require close to two trillion in Asset reductions. I expect they will be cautious about announcing the removal of this stimulus - although it might happen sooner than most think. Most think that the Asset Sales (or Asset run-offs as they decide not to reinvest proceeds) will start before they begin to raise the funds rate.
It should be interesting to say the least. I think the Fed is waiting for more clarity on the Tax & Spending policies of the next Congress and President before clarifying how they will remove the massive amounts of monetary stimulus.
It should be interesting to say the least. I think the Fed is waiting for more clarity on the Tax & Spending policies of the next Congress and President before clarifying how they will remove the massive amounts of monetary stimulus.
RSS Feed
