In the Fed's Shoes

Treasuries have been getting crushed this week. They can't afford to have rates keep rising this much.

The fed could stampede investors out of stocks and back into treasuries. That's probably what I would do in their hopeless situation. Getting people out of stocks would be as simple as being honest about the economy, or no longer using the credit of the U.S. to prop up insolvent companies.

That would be doubly effective because the bailouts are one of the things that make treasuries so unattractive.

Comments

[dybydx:]

ya, let GM go for chapter 7 and everyone will ditch equity for treasuries.

in related news, China surpassed US as the #2 auto maker after Japan.

May 28 03:11 AM

[fireball:]

raising capital gains would also give a push. got to take care of the bankster cartel aka the fed.

May 28 09:12 AM