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  1. You have the right to remain silent. Any order you post can and will be used against you.
    1 point
  2. "The Fed has to issue debt to buy debt." What an absolute load of crap. The Fed creates "reserves" out of thin air by issuing a credit to the accounts of the dealers from which it purchased the debt. It paid an interest subsidy to the banks and MMFs as a policy matter. It did not have to do that. In fact, it set the level of those payments at zero for years, and then arbitrarily started subsidizing the banks when it raised the Fed Funds Rate, the IOER, and the RRP rate. Purely arbitrary monetary policy actions. WHen the Fed created that excess money in the system, it had to go somewhere. It went into stocks and bonds, creating the greatest bubbles in history. The deposits it created in the dealer accounts instantly became money. The Fed can arbitrarily decide to sell its assets and thereby remove those deposits from the banking system, which the banks don't hold any reserves on. It's simply excess cash that they have on deposit at the Fed. They can trade with each other, but the money can only leave the system if and when the Fed decides to remove it by redeeming or selling the assets it holds. So as the Fed lets the Treasury debt roll off the balance sheet the deposits that it created also disappear. On the other hand, Treasuries can be repoed. So when the dealers, hedge funds and others buy government debt with repo paper, the money supply also expands. But so does the leverage and the danger. The difference between Fed created money and repo created money is the leverage. It will blow up if they allow prices of stocks and bonds to fall. Under QE, they couldn't fall because the Fed was a constant buyer. These crumbbums are a bunch of self congratulatory bunko artists.
    1 point
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