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Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: Elroy Jetson who wrote (104311)	8/8/2009 4:34:20 PM
From: 8bits	Read Replies (2) \| Respond to of 110194

A central bank is a puzzle box by design, but we're not seeing an increase in Permanent Reserves. en.wikipedia.org I am assuming that the part in orange are the permanent reserves. To later take this liquidity away, the central bank requires banks to buy this sort of paper from the central bank with their reserves. Given the condition of the US banks I wonder how long the temporary reserves will be held and if the FED's assets will be sold at par. If they have substantial losses on their temporary assets when they sell them back to the market, isn't that monetizing to some degree?