The Fed's Balance Sheet 54 comments
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Always good to keep things in perspective. The most recent Fed Balance Sheet reading of $2.16 trillion is a doozy and is only getting higher, and a couple hundred bucks away from the highest ever recorded of $2.17 trillion a month ago. This is just the beginning: Bernanke and Co. have committed to monetizing $1.75 trillion of securities this year, of which $1.21 trillion remain to be purchased still. This means that the chart will likely pass the $3 trillion mark at some point over the next 3-6 months. As to the yield on these securities once the total is over $3 trillion, if the current trendline of UST pounding is any indication, look for something north of 5%.
Just as a reminder, the total foreign central bank holdings of Treasuries and Agencies is $2.7 trillion.
Very soon America's largest creditor will be... America.
Source: Federal Reserve H.3 and H.4.1 releases.
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This article has 54 comments:
the balance sheet balances the asset on left side which is offset by liability and equity (or net asset/reserve)
On May 26 02:23 PM Dave Wrixon wrote:
> I know it sounds like a daft question, but why do they call it a
> Balance Sheet?
On May 26 02:32 PM dybydx wrote:
> its called balance sheet because it works like a balance (ie that
> little weight scale you see lady justice holding at the court house).
>
>
> the balance sheet balances the asset on left side which is offset
> by liability and equity (or net asset/reserve)
On May 26 02:32 PM dybydx wrote:
> its called balance sheet because it works like a balance (ie that
> little weight scale you see lady justice holding at the court house).
>
>
> the balance sheet balances the asset on left side which is offset
> by liability and equity (or net asset/reserve)
On May 26 02:35 PM FE812 wrote:
> We'll be paying ourselves back through inflation. That is afterall,
> the idea of this exercise correct?
Watch Rep. Grayson ask the question several different ways to discover that Elizabeth Coleman, the Fed's Inspector General, really has no idea what lurks within its balance sheet.
www.youtube.com/watch?...
Instead of the U.S. government simply printing money, unencumbered by anything, the Treasury Department creates new bonds, GIVES THEM to the PRIVATE BANKERS of the Fed, and then the Fed SELLS those bonds to the American people indebting Americans (to those odious private bankers) for every dollar of money printed!!!!!!!!
Also, when we're talking about "IOU"s, no one should forget the $3 TRILLION stolen from the Social Security "trust fund" (lol) - that will NEVER be repaid. Bye-bye "Social Security" for anyone under 50.
On May 26 02:38 PM linenoise wrote:
> Can't we just forgive the debt we owe ourselves? Oh right. Privately
> owned central bank. Nevermind.
The Federal Reserve needs to be abolished and a National State of Credit to monotize real productivity for the economy is needed to save us from ourselves.
And since we wont come to our senses any time soon roll with the punches.
Now, how does the Fed increase or decrease its "Equity", and what would happen if the Fed's Equity goes below zero?
A single entry does not make a balance sheet.
I suspect the author means the assets total. So, copied straight from Wikipedia and out of date already --
"Gold certificate account 11,037
Special drawing rights certificate acct. 2,200
Coin 1,870
Securities, repurchase agreements, term auction credit, and other loans 1,525,857
Securities held outright 967,070
U.S. Treasury 534,969
Bills 18,423
Notes and bonds 516,546
Federal agency debt securities 64,511
Mortgage-backed securities 367,590
Repurchase agreements 0
Term auction credit 455,799
Other loans 102,988
Net portfolio holdings of Commercial Paper Funding Facility LLC 242,431
Net portfolio holdings of LLCs funded through the Money Market Investor Funding Facility 0
Net portfolio holdings of Maiden Lane LLC 26,481
Net portfolio holdings of Maiden Lane LLC II 18,253
Net portfolio holdings of Maiden Lane LLC III 27,429
Items in process of collection 1,147
Bank premises 2,191
Central bank liquidity swaps 282,863
Other assets 56,855
Total Assets 2,198,613"
Its not that hard to find.
When will some common sense prevail? When heavily in debt - you don't go farther into debt to solve your debt problem! Come on! Get real! Stop this silliness before there is irreparable damage done. Its not to late. However the clock is ticking.
On May 26 09:47 PM shrike wrote:
> Lame.
>
> A single entry does not make a balance sheet.
>
> I suspect the author means the assets total. So, copied straight
> from Wikipedia and out of date already --
>
> "Gold certificate account 11,037
> Special drawing rights certificate acct. 2,200
> Coin 1,870
> Securities, repurchase agreements, term auction credit, and other
> loans 1,525,857
> Securities held outright 967,070
> U.S. Treasury 534,969
> Bills 18,423
> Notes and bonds 516,546
> Federal agency debt securities 64,511
> Mortgage-backed securities 367,590
> Repurchase agreements 0
> Term auction credit 455,799
> Other loans 102,988
> Net portfolio holdings of Commercial Paper Funding Facility LLC 242,431
>
> Net portfolio holdings of LLCs funded through the Money Market Investor
> Funding Facility 0
> Net portfolio holdings of Maiden Lane LLC 26,481
> Net portfolio holdings of Maiden Lane LLC II 18,253
> Net portfolio holdings of Maiden Lane LLC III 27,429
> Items in process of collection 1,147
> Bank premises 2,191
> Central bank liquidity swaps 282,863
> Other assets 56,855
> Total Assets 2,198,613"
>
> Its not that hard to find.
On May 26 09:47 PM shrike wrote:
> Lame.
>
> A single entry does not make a balance sheet.
>
> I suspect the author means the assets total. So, copied straight
> from Wikipedia and out of date already --
>
> "Gold certificate account 11,037
> Special drawing rights certificate acct. 2,200
> Coin 1,870
> Securities, repurchase agreements, term auction credit, and other
> loans 1,525,857
> Securities held outright 967,070
> U.S. Treasury 534,969
> Bills 18,423
> Notes and bonds 516,546
> Federal agency debt securities 64,511
> Mortgage-backed securities 367,590
> Repurchase agreements 0
> Term auction credit 455,799
> Other loans 102,988
> Net portfolio holdings of Commercial Paper Funding Facility LLC 242,431
>
> Net portfolio holdings of LLCs funded through the Money Market Investor
> Funding Facility 0
> Net portfolio holdings of Maiden Lane LLC 26,481
> Net portfolio holdings of Maiden Lane LLC II 18,253
> Net portfolio holdings of Maiden Lane LLC III 27,429
> Items in process of collection 1,147
> Bank premises 2,191
> Central bank liquidity swaps 282,863
> Other assets 56,855
> Total Assets 2,198,613"
>
> Its not that hard to find.
en.wikipedia.org/wiki/...
Also, it would seem to me that the true picture is far worse. Makes me wonder why M3 reporting was stopped a few months ago.
The end is not too far.
They should look at themselves when they talk about taking inappropriate risk and who should be regulated.
That would be really funny - if it weren't that serious.
Of course, one part of America will be the paying part - and the other one the receiving. Ironically, the taxpayer-bailed out banks will collect all the money while those hard working people who still have a job or a business will pay them the ever rising interest.
Abolish the FED and nationalize Goldman and JPM!
'If the American people ever allow PRIVATE banks to control the issue of their currency, first by inflation, then by deflation, the banks will deprive The People of all property until their children wake-up HOMELESS on the continent their fathers conquered. The issuing power should be taken from the banks and restored to The People, to whom it properly belongs.' --- Thomas Jefferson
Oh, also... why was a poor little housewife appointed FEDERAL RESERVE INSPECTOR GENERAL???
On May 26 03:39 PM square to the shooter wrote:
> Watch Rep. Grayson ask the question several different ways to discover
> that Elizabeth Coleman, the Fed's Inspector General, really has no
> idea what lurks within its balance sheet.
>
> www.youtube.com/watch?...
On May 26 03:40 PM Jeff Nielson wrote:
> Linenoise, you bring up an important point which is rarely mentioned.
>
>
> Instead of the U.S. government simply printing money, unencumbered
> by anything, the Treasury Department creates new bonds, GIVES THEM
> to the PRIVATE BANKERS of the Fed, and then the Fed SELLS those bonds
> to the American people indebting Americans (to those odious private
> bankers) for every dollar of money printed!!!!!!!!
>
> Also, when we're talking about "IOU"s, no one should forget the $3
> TRILLION stolen from the Social Security "trust fund" (lol) - that
> will NEVER be repaid. Bye-bye "Social Security" for anyone under
> 50.
On May 27 01:15 AM Dave Wrixon wrote:
> I think my point was that because the Fed is manipulating the market
> so obviously, the underlying assets just are not what they Fed has
> paid for them. How can anyone even the Fed keep buying Treasuries
> above their real worth to try to bring down the rates of interest
> the Government pays to a level that is sustainable? If this policy
> succeeds then they will be the only ones in the market for US debt,
> which will pretty much all be monetized and the dollar will go to
> hell. If they fail then US interest rates rise, all the dodgy securities
> they are holding will prove worthless and taxes will go through the
> roof whilst public services are cut, and the entire economy will
> go to hell, where it probably belongs anyway. The Federal problem
> is actually much worse than California's but just so much bigger
> and Obama is making it worse by the day.
Won't be ready for a pilot for 5 years, but the prototype works.
If we can avoid disaster for 10 years, we're set for an incredible energy revolution.
On May 26 09:29 PM The Geoffster wrote:
> Democracies don't last because the people always vote themselves
> the fisc. The only question now is whether cold fusion or some other
> miracle will save us from dictatorship.
On May 27 11:39 AM Christopher Hossli wrote:
> Those of us under 50 aren't going to get Social Security anyway.
> I want to sue the Federal gov. for the money i'm paying in cause
> i'm never going to see it back.
It is an archaic term still in use.
On May 26 02:23 PM Dave Wrixon wrote:
> I know it sounds like a daft question, but why do they call it a
> Balance Sheet?
CEO’s of banks and financial institutions going on TV and lying that their firms were strong and viable. (Angelo Mozilo, Jimmy Cayne, Ken Lewis, Robert Steele, Charles Prince, John Thain)
The President and Vice President of the United States lying to the American people that there were WMD in Iraq and proclaiming that Iraq was involved in the 9/11 attack.
The Secretary of the Treasury lying to the American people and Congress regarding the banking system in order to ram the TARP bill through Congress.
The Secretary of the Treasury and Federal Reserve Chairman threatening the CEO of Bank of America and forcing him to lie about the true losses of Merrill Lynch.
Mortgage brokers lying to their clients regarding the terms of the toxic mortgage products they were peddling.
Homebuyers who lied about their income and/or assets in order to qualify for a mortgage.
Alan Greenspan urging Americans to take out an adjustable rate mortgage when rates were at all time lows, while simultaneously saying that home prices on a national basis would never fall.
Treasury Secretaries and other high officials lying on their tax returns.
Financial advisors telling their clients to invest in a financial product because it makes the advisor more money, versus being in the best interest of the client.
Being politically correct in your speech rather than truthful because a constituent might be offended.
Politicians making promises to voters while trying to be elected which they never intend to keep.
When the President of the United States commits adultery in the Oval office and then lies to the American public.
theburningplatform.com...
On May 26 02:23 PM doubleguns wrote:
> But we can't pay ourselves back!!!
Sure you can, called the IRS, "you" will pay it back while the gov't plays footsie with the "fed" reserve and they both "bail out" their fatcat friends with the gov't not acting or even wanting to act on your behalf because they are circled by these "fed" fatcat friends everyday getting "lobbied".
It's the "good ole boys club" and until people wake up to that fact, that "your" gov't, irrespective of which side of the coin they fall on act on their own behalf first.
The rest of us peons are just the neverending stone they can squeeze.
The banks have already said that they will pay back "as much of the money as they can".
What exactly does "as much of the money mean" ???
This is a refreshing look as Alan Grayson outs the inspector general of the "fed" reserve as a lawyered up LIAR.
www.youtube.com/watch?...
"No state shall enter into any treaty, alliance, or confederation; grant letters of marque and reprisal; coin money; emit bills of credit; MAKE ANYTHING BUT GOLD AND SILVER COIN A TENDER IN PAYMENT OF DEBTS; pass any bill of attainder, ex post facto law, or law impairing the obligation of contracts, or grant any title of nobility."
Last I checked, this was never amended (activist jurists don't count).
The Fed is unConstitutional, period. It is the fourth, illegitimate, bastard branch of government, unaccountable to ANYONE besides its stakeholders (Goldman Sachs, et. al.) As are most executive branch organizations, Medicare, Medicaid, and unfunded mandates to states. As long as we keep electing phonies and frauds and appointing "empathetic" jurists to the high courts, we will descend into deeper levels of hell.
Table of M1 and M2 figures.
DIAF "cetin".
On May 26 07:43 PM StockCreeker wrote:
> The fed is corrupt. Our children will be burdened with this debt,
> and this will continue till there is nothing left. There is no democracy
> of the people-only one of the financial elite.
>
> Got lost, worthless troll
>
>
On May 28 08:33 AM James Quinn wrote:
> It will all collapse in a heap of burning rubble.
>
> theburningplatform.com...
Actually, that would be a 50% devaluation.
Case in point: it took 800 Korean won to buy a dollar a few years ago. When the value of the Korean won fell to the point where it took 1600 won to buy a dollar, its value fell by half.
You could eliminate the entire US debt by devaluing the currency by around 50% and raising taxes by around 20 points (meaning the top bracket would go to 55%).
Ultimately, that's probably what we will do. If we don't see substantial inflation over the next few years, a LOT of people are going to lose their homes, which will make for a prolonged depression. During long periods of economic trouble, people tend to turn against whoever is in power. The people in power won't let that happen.
The Fed's balance sheet is largely irrelevant. They have the ability to inject as much capital as they want. The only reason to restrain themselves is so that inflation can be controlled tightly. If they go too fast, people would get angry and that would mean politicians wouldn't get re elected. I would bet that they have a real inflation target of around 5-10% annually, despite their claimed 'ideal' of 1-2%. 5-10% would be just enough to erase the debt over a decade or two, while not being so rapid as to cause a panic.
If you don't think the Fed is under the control of 'the government', you're crazy. The fed will do whatever the people in power at the time want (bearing in mind that 'the people in power' include the people running the show at the fed).
The worst case for wealthy countries is really not 'that' bad. We have infrastructure, educated people, and huge amounts of natural resources. Sure, our savings might get shot to hell, but we'll survive.
Is the whole system rigged? Absolutely. But remember that wealthy people can ONLY stay wealthy if there is relative prosperity for everyone. If things get too bad, civil unrest will ensue and life will be substantially worse for everyone, including the very wealthy. Time and time again, we've seen what happens when people with too much power don't keep the people happy. It usually ends with heads being removed from bodies.
If you're really that convinced that everything is going to hell, why not go to the place that you think is doing something better? As near as I can tell, every wealthy country on the planet is in the same boat, and the rest of the countries are places you probably wouldn't want to live anyway.
On May 29 01:55 AM User 421764 wrote:
> Wow, basic math seems to really pass by some people. A 100% depreciation
> of the dollar isn't possible. Even Zimbabwe's dollar hasn't depreciated
> 100%.
>
> You could eliminate the entire US debt by devaluing the currency
> by around 50% and raising taxes by around 20 points (meaning the
> top bracket would go to 55%).
>
> Ultimately, that's probably what we will do. If we don't see substantial
> inflation over the next few years, a LOT of people are going to lose
> their homes, which will make for a prolonged depression. During long
> periods of economic trouble, people tend to turn against whoever
> is in power. The people in power won't let that happen.
>
> The Fed's balance sheet is largely irrelevant. They have the ability
> to inject as much capital as they want. The only reason to restrain
> themselves is so that inflation can be controlled tightly. If they
> go too fast, people would get angry and that would mean politicians
> wouldn't get re elected. I would bet that they have a real inflation
> target of around 5-10% annually, despite their claimed 'ideal' of
> 1-2%. 5-10% would be just enough to erase the debt over a decade
> or two, while not being so rapid as to cause a panic.
>
> If you don't think the Fed is under the control of 'the government',
> you're crazy. The fed will do whatever the people in power at the
> time want (bearing in mind that 'the people in power' include the
> people running the show at the fed).
>
> The worst case for wealthy countries is really not 'that' bad. We
> have infrastructure, educated people, and huge amounts of natural
> resources. Sure, our savings might get shot to hell, but we'll survive.
>
>
> Is the whole system rigged? Absolutely. But remember that wealthy
> people can ONLY stay wealthy if there is relative prosperity for
> everyone. If things get too bad, civil unrest will ensue and life
> will be substantially worse for everyone, including the very wealthy.
> Time and time again, we've seen what happens when people with too
> much power don't keep the people happy. It usually ends with heads
> being removed from bodies.
>
> If you're really that convinced that everything is going to hell,
> why not go to the place that you think is doing something better?
> As near as I can tell, every wealthy country on the planet is in
> the same boat, and the rest of the countries are places you probably
> wouldn't want to live anyway.
On May 31 08:42 AM F. Bradeen wrote:
> What good is a chart where I can't read the captions? Worthless!