Foreign Central Banks

How The Fed Helps The US Spy On Foreign Governments

It's widely known that the Federal Reserve has been tasked by Congress with a "dual mandate" to maintain maintain stable consumer-goods prices, low unemployment and - oh yeah - buoyant equity prices.  However, as Reuters revealed on Monday, the central bank has another legally binding obligation that might upset some of its clients: Helping US intelligence agencies spy on foreign governments.

Reflexivity And Why The Fed Must Sell The Long End

"If the Fed were to just let its balance sheet 'run off', it would cause additional pressure on short-term interest rates even as policy rates are rising. It could also potentially invert or further distort the front-end of the yield curve and destabilize the money markets... It would, therefore, behoove the Fed to sell some of its longer dated Treasury holdings to steepen the yield curve."

10 Year Auction Tails Despite Strongest Foreign Central Bank Demand Since January

Following the earlier blockbuster 3Y auction, moments ago the US followed up with today's second auction, a 9-year-11-month reopening of CUSIP X88, in which $20 billion in paper was sold, once again largely to willing foreign bidders, which however unlike today's earlier auction priced at a high yield of 2.195%, tailing modestly the When Issued of 2.188% by 0.7 bps.

The Fed Is About To Hike: Why That Is Bullish For Bonds

Contrary to conventional wisdom, Treasuries have rallied following the last three rate increases. Instead of sending yields higher, the hikes are driving speculation that rising short-term borrowing costs will curb the economic expansion and make it tougher for the Fed to sustain its 2% inflation target.

The US Is About To Hit $20 Trillion In Debt: Here's How It Affects You

As the vulture pundits in the mainstream media pick apart hollow political scandals, the essential bankruptcy of the federal government looms just ahead. The national debt is creeping toward 20 trillion dollars, and the United State’s largest problem is once again staring the world in the face.