(Last Updated on February 4, 2021)
The President of the Atlanta Federal Reserve Bank has walked back ANY comments that sounded remotely like a conservative approach or the slowing of the Fed’s monetary support.
They are truly saying there is nothing to worry about when it comes to inflation and the rapidly expanding supply of the United States dollar.
Just keep printing brrrrrrrrr!
“One other thing I should say – and I didn’t say this in those earlier interviews and that was a mistake on my part – is that our new long-run framework says explicitly we’re going to be willing to let the economy run hot.”
There is no end in sight to the printing of U.S. dollars to buy mortgage backed securities and treasury bills to save our the U.S. Government from failure and collapse. But the longer we kick the can down the road, the more we are injuring our future economic outlook and widening the disparity between our elites and poor through currency debasement.
Every U.S. dollar that is ‘printed’ without work and services occurring behind it, will just devalue the saved dollars of hardworking Americans around the country.
No, not one of those dollars will make it into your pocket or save the small business down the street, but at least those bonds are staying at nearly above a 0% return.. Although your dollars are currently being devalued by inflation at a rate of at least 4-6% per year, if not twice that.
Federal Reserve continues purchasing of treasury bills and mortgages
Earlier this month Bostic had made mention that the Federal Reserve should start slowing its asset purchases in short order, maybe as soon as this year.
He walked back those comments today.. and said there is NO plan to stop in sight.
“Not my expectation to taper quantitative easing this year. We’re not locked into anything, and our policy is actually going to be data-driven,” Bostic told Yahoo Finance.
2020 has set off unprecedented purchasing of mortgage backed securities and U.S. treasuries by the Fed which rapidly has turned into massive ownership in these asset markets.
Look how quickly the Federal Reserve balance sheet is stacking up U.S. treasury securities. It’s a wild change that has a lot of momentum in how it could affect our economy this decade.
Many economists believe rates would have to go negative and the U.S. would be fighting out of a much deeper recession if this continued monetary support pouring into treasuries month after month was to end.
Rates heading to zero with inflation rising = T-bills are the worst investment this decade
Much of our long standing as the world’s reserve currency is built on these fundamental assets. So they are pouring billions of dollars into the markets month after month without any transparency on how this will be unwound in the future.
Is anyone even buying U.S. T-Bills anymore or are we just doing stock buybacks on our own country at this point.
How does this unwind?
Inflation dwindles asset to debt ratio? Massive sell offs? Giant economic crash like never seen before?
If the plan is to tackle our looming debt issues with monetary expansion of the U.S. dollar supply, then any entity that is not holding hard assets will suffer severe wealth loss as inflation consumes purchasing power.
The 2008 mortgage and banking crisis BAILOUT changed how the Federal Reserve propped up our economy through money printing and bailouts. They injected billions and billions of dollars to save financial institutions that were full of fruad and unethical practices that disadvantaged and straight stole money from clients.
Junk mortgage lending platforms scamming consumers left and right with terrible subprime loans that were almost setup to have clients fail in the name of making big profits on the booming housing sector. Average homebuyers were being greatly over leveraged and preyed upon by financial companies that were supposed to have their clients best financial outlook in mind.
In a Yahoo interview today, Atlanta Federal Reserve President Raphael Bostic addressed current monetary policy and what the next few years may look like.
Bostic addressed his earlier comments and walked back any statements regarding the Fed slowing down any monetary support or any reduction in quantitative easing. Our Federal Reserve truly believes they can print their way out of the hole we are digging and that is terrifying.. It has only take a decade, or two, for this government to completely throw out any economic principles and values that may serve the citizens.
The current plan is to continue printing dollars as needed until the economic recovery makes substantial progress. Until then the U.S. Federal Reserve is going to continue printing dollars to buy mortgage backed securities and U.S. treasury notes. No one is actually sure of how they obtain their data and what analysts are really putting in the work. Obviously they must have their blinders on to many failing and overburdened segments of our economy – such as the massive growing national debt at 27 Trillion.
They are not going to stop and see no end in sight.
Instead they are diving into their own modern monetary theories and junk that will only push us deeper off the debt and inflation cliff.