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The Federal Reserve’s policy committee on Wednesday said that the Fed would buy more than $1 trillion in assets to revive credit markets, also leaving its target interest-rate range of 0% to 0.25% unchanged and signaling that the economy still has a long way to go before it recovers.
The Federal Open Market Committee said it would buy up to $300 billion in longer-term Treasuries over the next six months, up to an additional $750 billion in agency mortgage-backed securities (bringing the total this year to $1.25 trillion) and up to an additional $100 billion in agency debt (bringing the total up to $200 billion).
Originally posted by opal13
, but where are the feds getting another trillion dollars to spend in the next six months?
800 Billion dollars.
Originally posted by St Udio
Originally posted by opal13
, but where are the feds getting another trillion dollars to spend in the next six months?
They are going to buy Treasuries at the regular 'Auctions'...
((and the Fed will 'pay' in IOUs))
but here's the catch... the Fed is going to buy the longer term
Treasuries....bonds or whatever
until & unless the bottom completely falls out for US Treasuries and the Fed
needs to 'buy up' all the future 1yr/2yr- and up to the new issue 7 yr securities,
--> because the world markes might treat US Treasuries like Small-
Pox victims in the near future.
Keep in mind, that the Fed gets paid when Treasuries are issued and then converted into cash... otherwise the Fed only gets 'paid' the interest rate of the Treasury...
(which is put into the Fed 'Balance Sheet'
which is no way to perform a financial coup & take over the policy making decisions that the existing branches of government are currently performing ~rather badly~ !
Which is just what the Fed/Treas are currently undertaking... a bloodless coup
[edit on 18-3-2009 by St Udio]