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Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory

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To: russwinter who wrote (76378)	12/21/2006 8:58:59 PM
From: jimmg	Read Replies (1) of 110194

<<The Fed has conducted 7 coupon passes for $7.266 since Thanksgiving. That's about 15% annualized, so there is nothing technical or normal about this operation at all. That's less than 1% of the total Fed balance sheet and federal reserve notes in existence. That's $42 per household in America. I don't think the Fed printing up $42 per household to support the Christmas shopping season sounds so outlandish. As far as the FCB's buying $38 billion worth of "old maid cards", you are focusing on only 1 side of the transaction. They could not buy that much debt if there wasn't a supply and demand for that much credit. The FCB's didn't force anyone to borrow money. They had US dollars on hand and they needed to do something with the money. They bought debt and probably some equity instruments with the dollars. These are dollars that Americans spent on imports. What else are the FCB's supposed to do with the money? I see no conspiracy.

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