3 ms·

So much for unwinding the fed ballance sheet.

• cm2187 7y ago
  It's an overnight transaction, it should go away very quickly. The Fed has been surprisingly consistent in its reduction of QE [1]. There is no way QE will be drained by the next recession but what is interesting is that they keep draining even though they are considering lowering rates. I am surprised it doesn't have a bigger impact on the market given how large of an impact QE had on the way up. [1] https://www.federalreserve.gov/monetarypolicy/bst_recenttrends.htm https://www.federalreserve.gov/monetarypolicy/bst_recenttren...
  • wnissen 7y ago
    I suppose it's not something that the Fed would want trumpeted in every paper, but thanks for informing me that they were reversing QE. I agree, you would think that the effects of selling off a half trillion in assets per year since the beginning of last year would be much more substantial. Didn't they buy up a whole bunch of mortgages?
    • cm2187 7y ago
      I believe their balance sheet is about 50/50 between treasuries and mortgages, and that they are selling both.
  • somebodythere 7y ago
    Balance sheet runoff is over: https://www.cnbc.com/2019/03/20/fed-sets-end-of-balance-sheet-reduction-for-september.html https://www.cnbc.com/2019/03/20/fed-sets-end-of-balance-shee...