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To: NormsRevenge
I believe that the Fed will be making massive purchases - but those purchases will be of Mortgage-backed securities instead of Treasury securities.

The money printed to purchase those MBS will end up in the Excess Reserve accounts of the major banks instead of circulating in our economy - just like QE 1.

Any interest from those still paying on any of the MBS will be used to purchase Treasury securities - but this will not increase the money supply, since it's just cycling money in the back door and out the front door.

In short, the Fed will be purchasing between $500 billion and $1 trillion of securities - but those purchases will not increase the money supply of our economy.

Instead, the purchases will continue the largest transfer of wealth ever perpetrated upon mankind.

I've written more about it for those that care to read it:

The Fed's Ties to Real Estate Fraud

The Fed's actions will not increase the nation's circulating money supply one iota, even though the markets will interpret it that way.

16 posted on 11/01/2010 12:43:37 PM PDT by politicket (1 1/2 million attended Obama's coronation - only 14 missed work!)
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To: All

Sorry for the duplicate. I was sure I only hit the post button once.


17 posted on 11/01/2010 12:44:39 PM PDT by politicket (1 1/2 million attended Obama's coronation - only 14 missed work!)
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