> QE means buying assets that are not Treasuries. The short answer is that it depends - it is not not QE. it depends on the magnitude. Current operations seem

> QE means buying assets that are not Treasuries. The short answer is that it depends - it is not not QE. it depends on the magnitude. Current operations seem to go deeper into QE than regular OMO. > The price of a bond, mathematically, moves inversely with its yield. Yes? But the central bank han many other ways to influence the rate, eg. overnight rate and OMO instead of buying MBS, etc. As you indicate yourself, having the FED as a market participant will artificially lower the yield on MBS, which is a form of planned economy on the housing market. > You can't reduce the balance sheet and lower rates. Why the insane focus on lowering the rate? Keeping rates below 0 in real terms for long terms can arguable have very adverse effects - especially the day the currency is not backed by the largest military in the world (Which, surprise, is not decades into the future anymore). Regardless, the future will show what happens. We can nothing but speculate.