Fed To Buy Treasurys 3 Times In Next 2 Weeks

FOX BusinessNews/MarketWatch ^ | 8/19/09 | Deborah Levine

[Kartographer]

The Federal Reserve on Wednesday said it plans to purchase Treasury securities in three operations in the next two weeks, fulfilling policy makers' promise last week to slow down purchases of U.S. debt in the hopes that the program could help keep a lid on borrowing costs for consumers and businesses.

[Kartographer]

Reminds me of the episode of ‘Rocky and Bullwinkle’ when we find out our entire economy is based on cereal box tops!

[VisualizeSmallerGovernment]

Wait. So now they’re bailing out themselves?

[domenad]

Every time the Fed buys treasuries, they expand the money supply. How long before inflation catches up?

[GonzoGOP]

Here we go.

[CPT Clay]

Monetizing the debt.

[silverleaf]

China is not buying our debt, so we are

I hope Tim gives Ben a good deal ... or is it the other way around?

[Crawdad]

They’re buying at a $5 trillion/year clip.

[stephenjohnbanker]

ROTFLMAO!!

[PubliusMM]

But at least we aren’t monetizing the debt... (/sarc off)

This garbage has got to stop!

[stephenjohnbanker]

Good for a 1987 Yugo........with no air.

[Kartographer]

I'll do you one better!

[Kartographer]

For those Young Pups please review:

http://en.wikipedia.org/wiki/Box_Top_Robbery

[Nervous Tick]

>> fulfilling policy makers’ promise last week to slow down purchases of U.S. debt in the hopes that the program could help keep a lid on borrowing costs for consumers and businesses.

Is it just me, or is that total contradictory gibberish?

[schu]

How long before inflation catches up?

This is indeed the game they are playing. With PPI down 7% since the beginning of the year and bank/mortgage defaults looming, they do not believe that inflation is a worry. They are VERY worried about debt/deflation, so by monetizing the debt and keeping interest rates low, they hope that the economy will recover and we can avoid a replay of the 1930s.

The Fed is covering for Bam and Congress. Because of the Fed's actions, Bam can keep spending like crazy without the risks of higher interest rates or tax increases stifling the economy.

At some point Bernanke will need to put a stop to this, when they do, then the fun really begins. This cannot end pretty.

schu

[schu]

The article says they went from 4 to 3 purchases over the two week period .....

schu

[stephenjohnbanker]

Do you know if there are any reruns on the tv or internet?

Signed

Boris

[Nervous Tick]

>> For those Young Pups please review:

I watched a lot of Rocky & Bullwinkle when I was a young pup (6-12)...

then I went back to watching a lot of it when I was a young buck (early 20’s).

Blew me away how political it really was, once I was old enough to “get it”. I’d rate it right up there with South Park in terms of cutting-edge political parody.

[autumnraine]

So much time and effort put into that photoshop to have a word misspelled.

[Nervous Tick]

>> they went from 4 to 3 purchases over the two week period

Yes, they did reduce their purchases, but slowing down purchases is the opposite of what a monetizing Fed would do to “keep a lid” on consumer rates.

Not that I’m arguing it’s a good idea — I wish they’d stop buying treasuries completely.

[schu]

Agreed. Killing you slower ... :-)

You are still dead.

schu