owebo
Gold Member
- Jul 4, 2016
- 18,638
- 2,011
No, really....Inflation is out of fucking control.....Is she saying that the Fed Reserve will just reduce its balance sheets to reflect it no longer holds these MBS that have matured?
If an MBS matures and they don't buy a new one, the money is extinguished, their sheet shrinks.
I think that's what she's saying. We worried that the fed was putting too much liquidity in, and eventually we'd have too many dollars chasing "stuff," which means inflation. But if that's what the Fed is doing, there is no real inflation beyond the property secured by the mortgage is no longer encumbered when the mortgage is paid, and the property owner just has an asset that's valued at whatever the real estate market sets the value at.
That seems a pretty sweet way to have weathered the real estate crash. It doesn't alter the fact that a lot of people got foreclosed on and the banks didn't, and in the end that may have doomed the dems as much as Comey and the emails did. But still if the fed hadn't stepped in we may all have lost our asses.
I think that's what she's saying.
She's saying they don't plan to sell bonds.
We worried that the fed was putting too much liquidity in, and eventually we'd have too many dollars chasing "stuff," which means inflation.
No real inflation during QE. None since the end of QE in October 2014.
But if that's what the Fed is doing, there is no real inflation beyond the property secured by the mortgage is no longer encumbered when the mortgage is paid, and the property owner just has an asset that's valued at whatever the real estate market sets the value at.
Not sure what point you're trying to make here.
That seems a pretty sweet way to have weathered the real estate crash.
Or here.
It doesn't alter the fact that a lot of people got foreclosed on and the banks didn't
Yes, lots of people lost their homes. Banks lost hundreds of billions when they did.
But still if the fed hadn't stepped in we may all have lost our asses.
Yes, flooding the system with liquidity was a good thing.
My only point was that it's pretty sweet. QE may not have had an inflationary effect, despite fears. The only increase in monetary value would be a change in the property value from the time the fed took on the MBS and what it's worth when it's removed from the balance sheet. And that's not inflation, but rather a recovery in the real estate markets.
The inflationary pressure in the economy will come from govt deficit spending (TRUMP) and the slim possibility that Yellen won't raise rates enough.
Of course for those of us still paying off debt we accrued when our paychecks took a hit, this sucks. But the people who voted or Trump are dumb shmucks .... or rich and shrewd
Not really.