Feb 08

- “In Feb 2013, Fed Will Buy 75% Of New 30y Treasury Supply” (ZeroHedge, Feb 7, 2013):

We urge readers to read the bolded section below, which comes straight from this quariter’s Treasury Borrowing Advisory Committee (i.e., Primary Dealers) presentation to the Treasury Department, and explain, with a straight face, just how the Fed will ever be able to not only stop monetizing debt and injecting $85 billion of flow into the stock market, but actually sell any holdings.Federal Reserve Holdings (1 of 2)

As of Dec 26, 2012 the Federal Reserve System Open Market Account (SOMA) held approximately $300 billion in 21+ year US Treasury debt

  • SOMA holds 41% of the 30y Treasury bonds issued since 2009
  • In Feb 2013, Fed will buy 75% of new 30y Treasury supply

Twist and QE operations have significantly lengthened the WAM of the Fed’s SOMA portfolio

The Fed currently owns 29% of all marketable 10yr Equivalents outstanding

Full TBAC presentation:

TBAC by


Commentary:

“In the absence of the gold standard, there is no way to protect savings from confiscation through inflation. … This is the shabby secret of the welfare statists’ tirades against gold. Deficit spending is simply a scheme for the confiscation of wealth. Gold stands in the way of this insidious process. It stands as a protector of property rights. If one grasps this, one has no difficulty in understanding the statists’ antagonism toward the gold standard.”
- Alan Greenspan

“By a continuing process of inflation , governments can confiscate, secretly and unobserved, an important part of the wealth of their citizens. There is no subtler, no surer means of overturning the existing basis of society than to debauch the currency. The process engages all the hidden forces of economic law on the side of destruction, and does it in a manner which not one man in a million is able to diagnose.”
- John Maynard Keynes

Quantitative easing = printing money = creating money out of thin air = increasing the money supply = inflation = hidden tax on monetary assets = theft!

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One Response to “QE MADNESS: ‘In Feb 2013, Fed Will Buy 75% Of New 30y Treasury Supply’”

  1. Marilyn Gjerdrum Says:

    75% of US debt being purchased by the FED this month up from 34% in 2009 is Terrifying. Trend is leading in the wrong direction. Who will buy US debt? Answer, nobody but the US. We got away with it for a while because the dollar was the world reserve currency, every nation used the dollar in their international trades. That is no longer true.
    This cannot keep going much longer.
    Thanks for another great article on an important subject nobody in lamestream media wants to touch.

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