What will 'The Fed' do (Dec 12)

Discussion in 'Markets & Economies' started by TheEnd, Dec 12, 2012.

  1. TheEnd

    TheEnd Well-Known Member

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    TheEnd, Dec 12, 2012
    #1
  2. errol43

    errol43 New Member Silver Stacker

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    Treasury to Federal Reserve, need more $$$$$, Federal reserve gives $$$ to banks, banks use $$$$ to buy bonds..Result USA still solvent.

    I have a guess and say yes.

    Regards Errol 43
     
    errol43, Dec 12, 2012
    #2
  3. hawkeye

    hawkeye New Member Silver Stacker

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    Buy, buy, buy...
     
    hawkeye, Dec 12, 2012
    #3
  4. CriticalSilver

    CriticalSilver New Member Silver Stacker

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    CriticalSilver, Dec 12, 2012
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  5. Old Codger

    Old Codger Active Member Silver Stacker

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    The Fed has/had no choice.

    The USG must sell about US$1.2 trillion of new Bonds a year, plus redemptions.

    The foreign buyers are just about static, and the domestic buyers are fully committed by law to buy what they can. The other buyers are fools. If the USG needs 2 or 5 or 10 Trillion a year, the Fed will 'print' and buy them.

    QED



    OC
     
    Old Codger, Dec 12, 2012
    #5
  6. TheEnd

    TheEnd Well-Known Member

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    TheEnd, Dec 12, 2012
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  7. Auspm

    Auspm New Member

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    Often they make announcements in the effect of using the sentiment derived from public statements to shift the market - without actually doing anything.

    Essentially, you're moving the market by 'talking it up', a common trait in many market economies.

    If they raise rates, it'll kill the economy. Even a couple percentage points will see the country bankrupt in the very short term with no real net gain. Whether it's .5% or 2%, it's still well behind even the official inflation rate and won't pull in any savers at all.

    If they raise it to 5% or more, it'll murder the Government within a year or two because of the interest owing on the national debt.

    That said, the Fed will do what they always do - print. They have no other choice.
     
    Auspm, Dec 12, 2012
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  8. TheEnd

    TheEnd Well-Known Member

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    Do they not realise what they are doing? Is Bernanke actyually that stupid? Or are they doing this on purpose to kill the economy as planned buy the elite?
     
    TheEnd, Dec 13, 2012
    #8
  9. Caput Lupinum

    Caput Lupinum Well-Known Member Silver Stacker

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    Basically the Fed is out of bullets to fire. The fact that they have tied the QE or unlimited QE until they reach certain unemployment figures and/or inflation levels is just asking for trouble.
     
    Caput Lupinum, Dec 13, 2012
    #9
  10. GoldenEgg

    GoldenEgg Member

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    Why didn't gold rise on this news? the markets were expecting an even bigger stimulus?
     
    GoldenEgg, Dec 13, 2012
    #10
  11. thatguy

    thatguy Active Member

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    Who knows... all I know is if we get to QE6 gold will be worthless :|

    I pretty much think it is an agreement between the big investment banks and the FED which is basically we'll buy your toxic MBS and you short gold...
     
    thatguy, Dec 13, 2012
    #11
  12. long88

    long88 Member

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    gold is down..and usd index is lower as well.. (usually usd index lower, gold is up).

    some more market manipulation ?? or christmas present for re-entry.. as it seems to be cheaper now.. buying pm using AUD.
     
    long88, Dec 13, 2012
    #12

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