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Here’s How Much The Fed Will Buy During The First Four Months Of ‘QE-Lite’
Jerome Powell's "QE Lite" preview, delivered on Tuesday in Denver, suggests the Fed will attempt to
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Re: ” too much supply (i.e., too much collateral, and not enough cash) as Treasury l”
==> Too much garbage collateral priced too high!
So, how is that mechanical mis-function going to work?
i’m not sure i would call US bills and Treasury bonds “garbage” collateral. what kind of collateral would you prefer? too much of anything without enough cash on the other side will throw a monkey wrench into things.
“announcing permanent balance sheet growth while lowering interest rates risks being confused by some market participants as QE”.
Could it be that they are reading “plain English” so to speak?
Sounds like Plain English to me……………