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Federal Reserve Balance Sheet Update: Week Of September 1
Six months after our last update on the Federal Reserve's balance sheet in visual form, it is time to resume updating readers on what the biggest balance sheet in America looks like, especially since now that Fed is back in the monetization business. So without further ado, here is how Bernanke Capital, LLC looked as of September 1.
- Securities
held outright: $2,045 billion- Total Treasury holdings increased from $783 billion to 786 billion, as it bought another $3 billion in USTs as part of QE Lite. Look for this number to grow to well over $1.5 trillion in the next 6 months
- MBS holdings declined by $8 billion from $1.111 trillion to $1.103 trillion
- Agency holdings were flat at $157 billion
- Net
borrowings: unchanged at
$60 billion from the prior fortnight. - Float,
liquidity
swaps, Maiden Lane and other assets: $184
billion. FX liquidity swaps are at $44 million. The "value" of Maiden Lane I increased to the highest since November 2008, and was at $16 billion. Maiden Lane II was at $23 billion, while AIA Aurora was $27 billion. - The monetary base was $1.995 trillion
- Reserve balances with banks: $1.035 trillion
- Foreign holdings of USTs and MBS hit a fresh weekly high of $3.21 trillion.
- The ratio of Fed assets to the monetary basy was an elevated 1.15x, where it has been for a while.
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Looks fine to me. Think we're on track...to oblivion..
just wait untill the colour copiers run out of colored toner if they keep printing charts like that!
As I see it, toner use is going throught the roof at the FED offices!
Time to go long on office supplies!
I think, I understand, the future is looking bright, right?
This is a real growth story. How can I be part of this?
Keep paying taxes...
+1040!
EZ there, cowboy.
Nice deductive reasoning.
Turbo Tax Bitchez!
Sorry, only the people who's name begins with a : A, B, C, D and a E.
we'll start with the F people in 2015.
who will save Harrisburg PA debt holders ?
http://money.cnn.com/2010/09/02/news/economy/harrisburg_bond/index.htm?source=cnn_bin&hpt=Sbin
The future is...they will do what ever they have to. Adjust! Note to self: this might include throwing away everything you thought you knew!!!!
The future is so bright I gotta wear shades....that is the oncoming train a mach 2.
On the ohter hand, I wish I could do this with my portfolio. What a killer diller this is.
Wow. MBS makes the Fed balance sheet look like a snake that swallowed an elephant.
MBS about $1.5 TRILLION. Really worth ZERO !?
The future is t-9 weeks.
Obama is having a major press conference next Friday. He is making two trips next week to talk about the economy, visiting Milwaukee, Wisconsin, on Monday and Cleveland, Ohio on Wednesday.
Lets start the betting on how big stimulus #89 (i have lost count) is going to be, over/under $250B?
Better yet how big does it have to be before every dollar of tax revenue is met with $1.25 in debt issuance.......bueller? (or more likely tyler).
I'll take the over
A rising graph sinks all boats.
New Fed motto:
"WE PAY TOP PRICE FOR ANY FINANCIAL FOLLY (we have infinite money)"
Thanks Tyler, I really appreciate the update.
The chart shows that assets have been declining, and the only thing "quantitative" about the recent Fed decision is that it will serve to hold the Fed's asset base relatively constant; i.e. it will prevent a further decline due to MBS repayments.
It also shows what happened in 4Q08 -- that's when the real explosion happened with the junk of Maiden Lane and FX swaps. By the time QE was officially announced as policy a few months later, the balance sheet had already ballooned. The actions of QE 1.0 -- purchase of Treasuries and MBS/agencies -- had less of an effect on overall asset base, and had the greatest impact on the mix of the Fed's assets. Does anyone know who bought all that Maiden Lane stuff from the Fed post 4Q08? (Someone please audit the Fed).
The qualitity of the Fed's balance sheet greatly improved over the course of 2009 as Maiden Lane and swaps were replaced with MBS, Agencies, and Treasuries. Now with the Fed's most recent announcement, the Fed's balance sheet tightens further, with MBS/Agencies replaced by Treasuries.
You are correct. The Fed needs just $60 billion more in USTs to become the single biggest holder of US treasuries in the world.
How do I extrapolate that data, Tyler? Hmmmm. Where is that going and what does it mean?
It means Ben just needs more monetary fuel for us to reach escape velocity.
"Engineering, we need another $1,000 million tons of gasoline, thermite, nitro, and c4... just stuff it into the main tube ! Now where were those matches.. I'll just light things up and get this rocket into orbit."
You pile enough fuel on this thing and it'll go up.
That's bullish right? That USTs are so good that our central bank is loath to see anyone else get such a great asset...even though the supply seems infinite...
With enough support they can be number one.
http://www.youtube.com/watch?v=VZ2HcRl4wSk
These are reported numbers. You know like- CPI, PPI, GDP, etc..not implying conspiracy or cover up...They are (have been and will be) the buyer of last resort...have a great day...
I credit Big Kahuna for the link but this video is a good depiction of what the Fed has been doing.
http://www.youtube.com/watch?v=vdQFuTQ1l5U
Guess MBS portion is AAA since it's 1/2 the holdings !
the fed balance sheet shows welfare for banksters....trillions for banksters but not one red cent for americans...
The data in tha narrative don't agree with the graph.
There are two axes.
Mind if i axe ya question Tyler.Did ya mean axis or axes?
When you run a economic system that violates mathematical principles you have to invent weird graphs relating unrelated things with an extra imaginary axis.
Hmmmm, Do I use Federal Reserve Notes or toilet paper next time I have to take a dump?
I don't think Pepto is going to soothe that MBS ulcer.
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Breaking News Alert: Obama's economic team considering new stimulus package September 2, 2010 5:21:20 PM
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With the recovery faltering less than two months before the November congressional elections, President Obama's economic team is considering another big dose of stimulus in the form of tax breaks for businesses -- potentially worth hundreds of billions of dollars, according to two people familiar with the talks. Among the options are a temporary payroll tax holiday and a permanent extension of the research and development tax credit, say people familiar with the talks.
http://link.email.washingtonpost.com/r/0H2RO6/0GGQXY/2V9IAW/F1R6GN/NGQ5Z...
For more information, visit washingtonpost.com
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That's all I need to hear. Risk on tomorrow- waiting for my $100,000 voter security check...
http://www.reuters.com/article/idUSTRE67O4WF20100902
O.K. Based on the lending standards of the leasing company I worked for I would probably lend the Fed up to $200,000. But, they would go into the high risk category. That means a 40% minimum down payment and a max 24 month term.
Double dip rainbow. It's beautiful. It's like a technicolor dreamcoat. Woh. But what does it mean?
http://www.youtube.com/watch?v=n6iqo_K8pUc
Someone needs to overlay the UK and other CBs' holdings onto this. I suspect that this graph doesn't tell the real story.
At the rate new debt is being issued, ONLY central banks have the "money" to buy it. Inflation via these means is a foregone conclusion absent some incredible political inversion.
Why may US Treasuries grow to $1.5T in next six months?
Bottom line, Fed is keeping the financial paper market pumped up.
Why? Because financial paper is much or most of the assets on financial sector balance sheets (banks, etc).
Keeping the financial paper market pumped up doesn't help the real economy. In fact it hurts the real economy. But the financial sector stopped caring about the real economy a long time ago. They have their own little (fantasy) world now, quite disconnected from the real world.
Obama's primary job is to help keep that fantasy financial paper world pumped up. Like them, he couldn't care less about the real world and the real economy ...and Bush was the same way ...and every president hereafter will be the same way.
If I could afford it, I would buy a new car and a hot tub -- maybe Chase will increase my credit line. If my bank fails can I pay my mortgage payment directly to the FED?
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