??? I have exited the stock market under this "stimulus scheme"
What is so different with the federal government doing it. I would love for them to make enough to pay off the debt
Those who don't know history are bound to repeat it.
What is perplexing is that the pumping by the Fed has not stopped.
I never understood why people are upset over this. I say lets pump more in. When the Federal Government sells it finally, they may ACTUALLY have a profit on our money for a change. Don’t you have investments that you put money into every money???? What is so different with the federal government doing it. I would love for them to make enough to pay off the debt (even if it is 20 years from now).
Um, they are pumping fiat dollars into the shock market. When they(FedGov™) “sells” the bottom falls out.
Your post is probably satire, but I will answer anyway. There is no investment by the Fed, just inflation. They print up money and buy a few types of securities which they stick on a shelf to rot. If they even started to sell those securities (ever) the price would plunge, so there is no profit to be made. Essentially there is nobody more stupid than the Fed who will buy that junk. That's mainly because we have promised trillions to ourselves in entitlements but also because we would strangle the economy if we raised taxes enough to pay off the debt.
The most common security the Fed buys is Treasuries which is what we the taxpayers are on the hook for. If the Fed sold those there would be no "profit". Instead we taxpayers would owe payments to the buyer instead of the Fed. The obvious conclusion is that they will never sell those, they are just inflating. The reason why we don't see price inflation even though the Fed is inflating is that the money goes to politicians and from there to campaign contributors and LIVs. The campaign contributors like big banks or GM or Solyndra and their owners help prop up the markets on Wall St. There is really not much else they can do with that money.
The second type of Fed purchase is directed more to the banks. The big banks churn mortgages, make profits by refinancing, then bundle and sell the mortgages to the Fed via Fannie and Freddie. Lots of money for big banks means a good chunk of money for Wall St. The Fed is inflating when they do this since have no (or little) intention of selling those mortgage securities. Those will go and stay on the shelf next to the Treasuries. This inflation does not result in much price inflation because ordinary people don't get that money, just a slightly lower mortgage payment. A few may get cash-out refinancing and spend some money on a new kitchen but not enough to drive up prices.
If the Fed decided to sell any of their securities, the first thing that would happen is the price would plunge, which means interest rates would rise (either US Gov interest rates or mortgage interest rates, probably both). The US Gov would gradually run out of new money to spend. The old debt payments would not rise since the interest rates are fixed, but payments on new debt would and that would gradually crowd out other spending.
Here's the short version: the Fed can't pay off the debt by buying debt at low prices and selling it at high prices. There are no greater fools so the high prices won't stay high and the very act of selling will raise rates and increase the debt.
Here's the really short version: the Fed is buying IOU's from drunken politicians and that's not likely to be profitable.