A soverign debt crisis is underway with the largest buyer of US debt being the American taxpayer (who is also paying out of his other pocket in the form of taxes). Nothing else really matters to the markets for more than a day or two. The debt crisis is the final nail for the US economy (and the Federal Reserve's existance). Japanoshima is only accelerating the outcome.
The government is incapable of ever managing the economy. That is why communism collapsed. It is now socialism’s turn - Martin Armstrong
Japan is unlikely to sell Treasuries, according to James Caron, head of U.S. interest-rate strategy in New York at Morgan Stanley, a primary dealer. “We don’t think it’s going to happen,” said Caron in an interview on Bloomberg Television’s “In the Loop” with Betty Liu, adding that Japan didn’t sell Treasuries after the 1995 earthquake in Kobe. “That is a complete falsehood.” The Fed purchased $6.989 billion of debt maturing from February 2014 to February 2015 today as part of its effort to keep borrowing costs low. The central bank reaffirmed this week its plan to buy $600 billion of Treasuries through June.
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The government is incapable of ever managing the economy. That is why communism collapsed. It is now socialism’s turn - Martin Armstrong
I found this pair of comments most interesting.