Posted on 01/11/2010 8:58:40 PM PST by dollarbull
No, the headline is not a misprint. According to CNBC, the Federal Reserve bought approximately 80 percent of the U.S. Treasury securities issued in 2009. In other words, the Federal Reserve has been gobbling up the massive tsunami of U.S. government debt that has been created over the past year. This is absolutely unprecedented, and it is yet another clear indication that the U.S. financial system is on the verge of a major economic collapse.
(Excerpt) Read more at theeconomiccollapseblog.com ...
Springtime in Zimbabwae
This sounds impossible. But, then again... electing a Chicago communist to POTUS sounded impossible...
She's cute, but it sounds like she's not so clear on the math. 80% of $1.5 trillion is $1.2 trillion while the Fed holds just under $777 billion in Treasury securities.
This is utterly false. The Fed bought $300 billion of treasuries last year, and owns less than $800 billion total. The Fed didn’t buy most of those treasuries. Stop this conspiracy garbage.
“Stop this conspiracy garbage.”
Thank you. Things are scary enough without Chicken Little’s running around pronouncing more catastrophes are imminent.
It’s more complicated, involving the Fed in allowing foreign banks to trade out of agency debt and into Treasuries, but still scary. See, e.g.,
http://www.zerohedge.com/article/ultimate-shell-game-federal-reserve-funds-us-deficit
/excerpt/
In the current hodge podge of abstract finance, it is easy to get lost in the numbers and lose sight of the forest for the trees. Which is why we provide the ultimate simplification: In calendar (not fiscal) 2009, the US grew its budget deficit by $1.47 trillion. In the same time, the Federal Reserve grew its securities holdings from $500 billion to $1.85 trillion, a $1.34 trillion increase. Keeping it simple: 91% of the budget deficit increase in 2009, under the authority of President Obama, was funded by the... United States.
I don’t know but buying 800 Billion of our own debt last year does not sound good given the huge debt coming up this year. Will there be buyers for this years debt or will the Fed have to buy a lot of it again to keep interest rates down? It is not healthy when a country buys it’s own debt.
4 am bump ... ;-)
* Since September 1, 2008, the monetary base has ballooned from $908 billion to $2.0 trillion. The current monetary base is now equal to bailing out General Motors 23 times.
* Bailout funds in 2008 and 2009 total $8.1 trillion. That’s almost 78 WorldComs. It’s over 123 Enrons.
* U.S. debt has risen sharply, from $6.2 trillion in 2002 to $12.1 trillion today. That’s over $39,000 per citizen.
* David Walker, the comptroller general of the Government Accountability Office from 1998-2008, warned that the U.S. is on the hook for $60 trillion in unfunded liabilities. Independent analysts peg the figure at near twice that. Whatever the number, it is incomprehensibly large. The only way we will meet these liabilities is to print the money and inflate them away.
We’re bailing out corporations that should fail, making financial promises we can’t keep, and adding layers of debt we can’t possibly repay. And the real killer is, if we don’t have the cash, we just print it. It is, by any reasonable account, the “blunder that will plunder” the next several generations. It is changing America permanently, and the problems will persist long after you and I are laid to rest.
Bottom line: after all the bailout programs, housing initiatives, rescue efforts, stimulus schemes, bank takeovers, wars, unemployment benefit extensions, and numerous other promises, the biggest financial deception of the decade is what the U.S. government is doing to the dollar. Nothing else even comes close.
This reckless activity has spooked our foreign creditors, weakened our global standing, diluted our currency, is punishing savers and retirees, and ultimately sets us up for a level of inflation this country has never seen before.
http://www.marketoracle.co.uk/Article16281.html
Do you have a link for the source of your figures? I'm interested in looking into this a bit more.
They bought $300 billion. They now own about what they owned 2 years ago.
“The Federal Reserve Bought Approx. 80% Of U.S. Treasury Securities Issued In 2009”
Not true... Here’s the Fed’s actual balance sheet.... if you care to look at it.
http://www.federalreserve.gov/Releases/H41/Current/
The fed bought $300 billion of the roughly 1.4 trillion treasuries issued in 2009. That’s around 20% not 80.
No matter how many times you repeat it, it remains just as false. The Fed's increased securities holdings went mostly into corporate equity (the bank bailouts) and mortgage backed securities. Only a small portion went into treasuries.
Take off the tin foil now, it's ok. . . really.
http://www.federalreserve.gov/Releases/H41/Current/
You can always try the Fed’s own website. Much better than listening to the Tin Foil Hat crowd.
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