The Fed hasn't been taken over by Trump, the government are becoming bagholders. | |
Anonymous Coward User ID: 78693589 Mexico 03/27/2020 11:15 PM Report Abusive Post Report Copyright Violation | [link to finance.yahoo.com (secure)] Quoting: Chaosisfreedom This article tells people that Trump is now in control of the Fed, but that's not how what just happened works. This means that because the Fed isn't allowed to directly buy those securities they are using a loophole to allow the Treasury to do it. And where does the Treasury get its money from.....? The Fed. This is allowing the government to directly take on these assets, which are depreciating and on the verge of deleveraging. It is allowing overleveraged funds to make the government the new bagholder of their assets which are about to nuke to zero. This is actually going to be the most brazen act of Wall St theft from Americans yet. It makes sense that Trump would ok this. At the moment GDP is what you all use to measure the economy, and financial services contribute bigly to your GDP. So if Trump let's Wall St take the hit, then goodbye American economy. He understands that they can't be allowed to go down, and the American government can take the hit. That's what they're there for in his eyes. The Fed can print whatever sum they ask for, it just goes onto the tab (National Debt). You need a strong economy to try pay the tab so you gotta save the elements of the economy that are making it strong, Wall St. To repeat, what this actually means is this: This is going to allow Wall St to transfer ownership of securities to the American government. Those securities haven't been liquidated yet because the Fed has been lending these firms the money to stop liquidation (margin calls, in the form of repo market loans). This will effectively stop the repo market crisis. But it will mean the immediate liquidation of those positions. (unless the government keeps printing more money to continue to meet the margin calls, while printing enough money to boost the markets back up to the precious levels where these would be back in the money and able to be sold, which at that point it's cheaper for the government to just take the hit). Wall St are about to be saved at the expense of the taxpayer to the tune of a few trillions dollars. Great info op. Mnuchin promised "unlimited liquidity". But will it be enough to stave of the multi quadrillion dollar debt market bubble from popping? The stock market is pure fiction at this point. The real economy is breaking under the strain. Bonds and oil aren't definitely aren't signaling a strong economy. |
rolltiderv2
User ID: 77273949 United States 03/27/2020 11:23 PM Report Abusive Post Report Copyright Violation | |
Anonymous Coward User ID: 78426329 Netherlands 03/27/2020 11:25 PM Report Abusive Post Report Copyright Violation | |
Chaosisfreedom
(OP) User ID: 36114458 Australia 03/28/2020 01:56 AM Report Abusive Post Report Copyright Violation | |
Anonymous Coward User ID: 77070316 Denmark 03/28/2020 02:06 AM Report Abusive Post Report Copyright Violation | |
Otherguy2020
User ID: 78562356 United States 03/28/2020 02:50 AM Report Abusive Post Report Copyright Violation | The US Treasury is now the collateral provider for banks borrowing money from the FED repo window as well. Over 1 trillion a day according to the federal reserve. Smokingman |
Anonymous Coward User ID: 76120456 Romania 03/28/2020 03:03 AM Report Abusive Post Report Copyright Violation | [link to finance.yahoo.com (secure)] Quoting: Chaosisfreedom This article tells people that Trump is now in control of the Fed, but that's not how what just happened works. This means that because the Fed isn't allowed to directly buy those securities they are using a loophole to allow the Treasury to do it. And where does the Treasury get its money from.....? The Fed. This is allowing the government to directly take on these assets, which are depreciating and on the verge of deleveraging. It is allowing overleveraged funds to make the government the new bagholder of their assets which are about to nuke to zero. This is actually going to be the most brazen act of Wall St theft from Americans yet. It makes sense that Trump would ok this. At the moment GDP is what you all use to measure the economy, and financial services contribute bigly to your GDP. So if Trump let's Wall St take the hit, then goodbye American economy. He understands that they can't be allowed to go down, and the American government can take the hit. That's what they're there for in his eyes. The Fed can print whatever sum they ask for, it just goes onto the tab (National Debt). You need a strong economy to try pay the tab so you gotta save the elements of the economy that are making it strong, Wall St. To repeat, what this actually means is this: This is going to allow Wall St to transfer ownership of securities to the American government. Those securities haven't been liquidated yet because the Fed has been lending these firms the money to stop liquidation (margin calls, in the form of repo market loans). This will effectively stop the repo market crisis. But it will mean the immediate liquidation of those positions. (unless the government keeps printing more money to continue to meet the margin calls, while printing enough money to boost the markets back up to the precious levels where these would be back in the money and able to be sold, which at that point it's cheaper for the government to just take the hit). Wall St are about to be saved at the expense of the taxpayer to the tune of a few trillions dollars. Do you think a certain group of allegedly chosen folks won't have assets they effectively stole repossessed? It's over for them. Many debts will be cancelled out of necessity. It's a reset to purge actions of the shabbateans. |
Anonymous Coward User ID: 12423164 United States 03/28/2020 03:13 AM Report Abusive Post Report Copyright Violation | the fed create the mess,they shpuld clean it up,and since they cant,trump is. trump begged them to lower rates.everytime he requested,they failed,then when the fed wanted to,it was too late. fed was broke anyways. now we will have real numbers to gage by with real interest rates.this will beaf up the american economy even more.the usa sinks or swims on its own merits. |
SyncAsFunk
User ID: 78652248 United States 03/28/2020 03:21 AM Report Abusive Post Report Copyright Violation | |
nimmerfall
User ID: 72716118 United States 03/28/2020 03:29 AM Report Abusive Post Report Copyright Violation | it's ok, Sync as Derp will post a couple Stalin smileys with faux Nazi German text and call everyone a kneeler and it'll be all good. Piercing my heart there is a golden dagger; that is God Piercing God's heart there is a golden needle; that is me |
Anonymous Coward User ID: 77027822 03/28/2020 03:34 AM Report Abusive Post Report Copyright Violation | |
Anonymous Coward User ID: 76640188 Denmark 03/28/2020 03:34 AM Report Abusive Post Report Copyright Violation | the fed create the mess,they shpuld clean it up,and since they cant,trump is. Quoting: Anonymous Coward 12423164 trump begged them to lower rates.everytime he requested,they failed,then when the fed wanted to,it was too late. fed was broke anyways. now we will have real numbers to gage by with real interest rates.this will beaf up the american economy even more.the usa sinks or swims on its own merits. |
Anonymous Coward User ID: 76120456 Romania 03/28/2020 03:37 AM Report Abusive Post Report Copyright Violation | |
Anonymous Coward User ID: 76120456 Romania 03/28/2020 03:37 AM Report Abusive Post Report Copyright Violation | |
SyncAsFunk
User ID: 78629979 United States 03/28/2020 12:39 PM Report Abusive Post Report Copyright Violation | |