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Strategies & Market Trends : Mish's Global Economic Trend Analysis -- Ignore unavailable to you. Want to Upgrade?

To: valueminded who wrote (97329)	5/8/2009 10:03:29 PM
From: Think4Yourself	Read Replies (1) \| Respond to of 116555

"If they can't sell it, the Fed buys it." That is what is bothering me. If the Fed buys the trillion dollars or so of treasuries the Chinese are selling, and most of the deficit debt, their balance sheet could easily explode to 4 trillion dollars (isn't it 2 trillion right now?). Will that cause a loss in faith in the currency? China is already losing faith in the dollar, as is Russia and many countries in the Middle East. Loss of faith in the dollar isn't an issue right now, but it appears it could be a real issue very soon. Either way, interest rates are going up.