the treasury does not buy its treasuries back. (so?)
when X sells treasuries it is on the market. they are paid in dollars by the purchaser (not the treasury here). they are no more buying dollars than burger king is buying dollars.
when the seller gets money, option 1 is to have it kept in usd and option 2 is to sell the dollar and buy another currency (presumably to repatriate in local currency)
====
the dollar index is a weighted index of exchange rates for 6 currencies against the dollar
if reluctance of buyers causes interest rates to rise above the level that the Federal Reserve wants, the Federal Reserve must step in and essentially "print" money to buy bonds and take them off the market. In this case, the value of the Dollar is diluted and the dollar index comes under downward pressure.
It seems that the general expectation is that the Federal Reserve will have to (in the somewhat near future) "print" more money to take bonds off the market. Otherwise a sell-off in bonds will occur as countries try to unload more of them just as buyers become more reluctant.
It's not just the bond market that the Fed will have to print dollars to cover. Think about the $100+ trillion of unfunded liabilities that no one wants to give up. All of that will be keyboarded into existence when the need arises.
It seems pretty obvious to me that this will cause both gold and stocks to climb higher and faster. It won't even matter what happens to the dollar index.
Q: Are You Printing Money? Bernanke: Not Literally
It's not just the bond market that the Fed will have to print dollars to cover. Think about the $100+ trillion of >unfunded liabilities that no one wants to give up. All of that will be keyboarded into existence when the need >arises.
If AI is real...and it leads to a 1% boost to real GDP....that problem completely vanishes.
Not saying it will...just that predictions 30-50 years out are nuts.
After 9/11 who thought we'd go 24 years without another attack ? Y2K ? Deficit spending ?
It's not just the bond market that the Fed will have to print dollars to cover. Think about the $100+ trillion of >unfunded liabilities that no one wants to give up. All of that will be keyboarded into existence when the need >arises.
It's called currency debasement and it has been well underway for decades, especially since 2008.
After 9/11 who thought we'd go 24 years without another attack ? Y2K ? Deficit spending ?
There are many forms of attack that don't involve tall buildings.
Tell me you are joking. It's a controlled currency akin to those old Roach Motels or the Hotel California -- you can check in, but you can never leave.
Tell me you are joking. It's a controlled currency akin to those old Roach Motels or the Hotel California -- you can check in, but you can never leave.
You asked, I gave a correct answer.
They devalued their currency 3 times in 2015.
And US inflation is not doing it every week, month and year? LOL
Tell me you are joking. It's a controlled currency akin to those old Roach Motels or the Hotel California -- you can check in, but you can never leave.
You asked, I gave a correct answer.
So you are NOT joking in your answer that China has never debased it's currency or experienced inflation?
Tell me you are joking. It's a controlled currency akin to those old Roach Motels or the Hotel California -- you can check in, but you can never leave.
You asked, I gave a correct answer.
So you are NOT joking in your answer that China has never debased it's currency or experienced inflation?
China devalues its currency against the dollar often to keep its exports moving. It is not the same as the US devaluing its dollars by increasing the money supply. Dollar devaluation is a permanent disease. Devaluation against a competing currency can be a smart, controlled, temporary move to boost ones economy; it apparently works well for China.
Inflation is a global event that no nation can avoid if it is involved in global trade. It is a result fo mismanagement of currencies by economic powerhouses. However, China seems to have inflation very much under control.
@MsMorrisine said:
the treasury does not buy its treasuries back. (so?)
US Fed buying bonds secretly? Here’s how it will impact investors, Gold and Bitcoin
In a move that has raised subtle alarms in financial circles, the U.S. Federal Reserve quietly purchased $43.6 billion worth of U.S. Treasurys over just four days last week.
@MsMorrisine said:
the treasury does not buy its treasuries back. (so?)
US Fed buying bonds secretly? Here’s how it will impact investors, Gold and Bitcoin
In a move that has raised subtle alarms in financial circles, the U.S. Federal Reserve quietly purchased $43.6 billion worth of U.S. Treasurys over just four days last week.
I think the Fed had short duration, lower interest rate treasuries that matured, and is using the proceeds to buy longer duration, higher interest bonds to replace them. I don't think it is additional money printing, or QE. The result of increased long bond demand is that long rates tend to drop a little. This may be an effort by the Fed to slightly slow down the market volatility which is becoming concerned about long rates increasing due to the debt downgrade.
Why is the Fed in the business of owning US bonds in the first place?
Without full transparency, nobody knows where the Fed's money comes from, whether it's from turnover of a given maturity of bonds or from money printing. It's a shell game and nobody wins except the bankers.
Q: Are You Printing Money? Bernanke: Not Literally
@jmski52 said:
Why is the Fed in the business of owning US bonds in the first place?
Without full transparency, nobody knows where the Fed's money comes from, whether it's from turnover of a given maturity of bonds or from money printing. It's a shell game and nobody wins except the bankers.
The Federal Reserve Act of 1913 gave the Fed the right to own US bonds. Not a secret.
The Fed board of governors provide more information than anyone has time to sort through, but much is available.
The Federal Reserve Act of 1913 gave the Fed the right to own US bonds. Not a secret.
That doesn't really answer my question, "Why is the Fed in the business of owning US bonds in the first place?"
The Fed is made up of privately owned bank members, but we are often told that the Fed is a quasi-governmental agency. So which is it? If it's a government agency, why would the government be allowed to buy its own bonds?
Q: Are You Printing Money? Bernanke: Not Literally
@jmski52 said:
Why is the Fed in the business of owning US bonds in the first place?
Without full transparency, nobody knows where the Fed's money comes from, whether it's from turnover of a given maturity of bonds or from money printing. It's a shell game and nobody wins except the bankers.
Perhaps the time has come to exit the bunker? You too could be winning, Jim. RGDS!
The whole worlds off its rocker, buy Gold™.
BOOMIN!™
Wooooha! Did someone just say it's officially "TACO™" Tuesday????
@jmski52 said: The Federal Reserve Act of 1913 gave the Fed the right to own US bonds. Not a secret.
That doesn't really answer my question, "Why is the Fed in the business of owning US bonds in the first place?"
The Fed is made up of privately owned bank members, but we are often told that the Fed is a quasi-governmental agency. So which is it? If it's a government agency, why would the government be allowed to buy its own bonds?
The federal reserve is a private entity just like federal express, it can do what it wants, and it does.
the federal reserve, before qe, held treasuries usually as collateral when banks ask for frn
for qe, the fed did their not literally money printing and bought treasuries and mbs and anything else? they put the money printed, on the ledgers of bank excess reserves. the excess reserves were meant to keep the banks from inadequate balance sheet strength as asset prices tumbled. thus we now have stress tests to protect from similar but bound to happen again situations
as part of tarp they bought "troubled assets" and this is another way mbs got on the balance sheet
Tell me you are joking. It's a controlled currency akin to those old Roach Motels or the Hotel California -- you can check in, but you can never leave.
You asked, I gave a correct answer.
So you are NOT joking in your answer that China has never debased it's currency or experienced inflation?
China devalues its currency against the dollar often to keep its exports moving. It is not the same as the US devaluing its dollars by increasing the money supply. Dollar devaluation is a permanent disease. Devaluation against a competing currency can be a smart, controlled, temporary move to boost ones economy; it apparently works well for China.
Chart update. This is the same one I posted a while ago. I wasn't too far off with my projection, I just thought it would take longer.
Silver's kind of got an up-channel going. We're at the very top... breakout soon? I think it's time...
Platinum in the same situation. I think Platinum is ripe for a move.
Seems like gold recently has developed a sense of normalcy. When the stock market goes up, gold goes down. The way it's supposed to be.
I'm still calling by 2028, the stock market will be up, possibly way up, while gold will be down or at best stagnant. That is unless a calamitous event takes place in the world, then all bets are off.
@ProofCollection said:
There's a big opportunity in Platinum. This long term (weekly chart) would indicate a breakout price target up near $3k. Could be another year before that happens, but it's going to happen.
@stevek said:
I'm still calling by 2028, the stock market will be up, possibly way up, while gold will be down or at best stagnant. >That is unless a calamitous event takes place in the world, then all bets are off.
I disagree and I'll tell you why.
The inverse relationship you cite is normal after the hypervolatility of early-April when the Tariff Tantrum dominated the financial markets for weeks.
I think both equities AND gold march higher. Gold has strong bidding underneath, and I would be shocked if my $5,000 by 2035 prediction doesn't come through. In fact, I'd say it's 50/50 that we hit it by 2030.
@ProofCollection said:
There's a big opportunity in Platinum. This long term (weekly chart) would indicate a breakout price target up near $3k. Could be another year before that happens, but it's going to happen.
Comments
the treasury does not buy its treasuries back. (so?)
when X sells treasuries it is on the market. they are paid in dollars by the purchaser (not the treasury here). they are no more buying dollars than burger king is buying dollars.
when the seller gets money, option 1 is to have it kept in usd and option 2 is to sell the dollar and buy another currency (presumably to repatriate in local currency)
====
the dollar index is a weighted index of exchange rates for 6 currencies against the dollar
if reluctance of buyers causes interest rates to rise above the level that the Federal Reserve wants, the Federal Reserve must step in and essentially "print" money to buy bonds and take them off the market. In this case, the value of the Dollar is diluted and the dollar index comes under downward pressure.
It seems that the general expectation is that the Federal Reserve will have to (in the somewhat near future) "print" more money to take bonds off the market. Otherwise a sell-off in bonds will occur as countries try to unload more of them just as buyers become more reluctant.
It's not just the bond market that the Fed will have to print dollars to cover. Think about the $100+ trillion of unfunded liabilities that no one wants to give up. All of that will be keyboarded into existence when the need arises.
It seems pretty obvious to me that this will cause both gold and stocks to climb higher and faster. It won't even matter what happens to the dollar index.
I knew it would happen.
If AI is real...and it leads to a 1% boost to real GDP....that problem completely vanishes.
Not saying it will...just that predictions 30-50 years out are nuts.
After 9/11 who thought we'd go 24 years without another attack ? Y2K ? Deficit spending ?
It's called currency debasement and it has been well underway for decades, especially since 2008.
There are many forms of attack that don't involve tall buildings.
ZeroHedge makes debut at White House press corps briefing
Has there been a country that has not debased their currency, or experienced inflation?
china
ZeroHedge makes debut at White House press corps briefing
Tell me you are joking. It's a controlled currency akin to those old Roach Motels or the Hotel California -- you can check in, but you can never leave.
They devalued their currency 3 times in 2015.
You asked, I gave a correct answer.
And US inflation is not doing it every week, month and year? LOL
ZeroHedge makes debut at White House press corps briefing
.
So you are NOT joking in your answer that China has never debased it's currency or experienced inflation?
Knowledge is the enemy of fear
China devalues its currency against the dollar often to keep its exports moving. It is not the same as the US devaluing its dollars by increasing the money supply. Dollar devaluation is a permanent disease. Devaluation against a competing currency can be a smart, controlled, temporary move to boost ones economy; it apparently works well for China.
Inflation is a global event that no nation can avoid if it is involved in global trade. It is a result fo mismanagement of currencies by economic powerhouses. However, China seems to have inflation very much under control.
ZeroHedge makes debut at White House press corps briefing
US Fed buying bonds secretly? Here’s how it will impact investors, Gold and Bitcoin
In a move that has raised subtle alarms in financial circles, the U.S. Federal Reserve quietly purchased $43.6 billion worth of U.S. Treasurys over just four days last week.
Read more at:
https://economictimes.indiatimes.com/news/international/us/us-fed-buying-bonds-secretly-heres-how-it-will-impact-investors-gold-and-bitcoin/articleshow/121251784.cms
http://ProofCollection.Net
the federal reserve is not the treasury
QE was the fed res buying treasuries and mbs
neither point addresses that:
the treasury does not buy its treasuries back
I> @ProofCollection said:
I think the Fed had short duration, lower interest rate treasuries that matured, and is using the proceeds to buy longer duration, higher interest bonds to replace them. I don't think it is additional money printing, or QE. The result of increased long bond demand is that long rates tend to drop a little. This may be an effort by the Fed to slightly slow down the market volatility which is becoming concerned about long rates increasing due to the debt downgrade.
My US Mint Commemorative Medal Set
Why is the Fed in the business of owning US bonds in the first place?
Without full transparency, nobody knows where the Fed's money comes from, whether it's from turnover of a given maturity of bonds or from money printing. It's a shell game and nobody wins except the bankers.
I knew it would happen.
The Federal Reserve Act of 1913 gave the Fed the right to own US bonds. Not a secret.
The Fed board of governors provide more information than anyone has time to sort through, but much is available.
https://www.federalreserve.gov/
https://fred.stlouisfed.org/series/TREAST
This is a fairly good summary of the history:
https://lawforeverything.com/1913-federal-reserve-act/
My US Mint Commemorative Medal Set
So gov has someone to sell their debt to. They scratch each other's back at the expense of value to the currency.
ZeroHedge makes debut at White House press corps briefing
The Federal Reserve Act of 1913 gave the Fed the right to own US bonds. Not a secret.
That doesn't really answer my question, "Why is the Fed in the business of owning US bonds in the first place?"
The Fed is made up of privately owned bank members, but we are often told that the Fed is a quasi-governmental agency. So which is it? If it's a government agency, why would the government be allowed to buy its own bonds?
I knew it would happen.
Perhaps the time has come to exit the bunker? You too could be winning, Jim. RGDS!
The whole worlds off its rocker, buy Gold™.
BOOMIN!™
Wooooha! Did someone just say it's officially "TACO™" Tuesday????
The federal reserve is a private entity just like federal express, it can do what it wants, and it does.
http://ProofCollection.Net
the federal reserve, before qe, held treasuries usually as collateral when banks ask for frn
for qe, the fed did their not literally money printing and bought treasuries and mbs and anything else? they put the money printed, on the ledgers of bank excess reserves. the excess reserves were meant to keep the banks from inadequate balance sheet strength as asset prices tumbled. thus we now have stress tests to protect from similar but bound to happen again situations
as part of tarp they bought "troubled assets" and this is another way mbs got on the balance sheet
$3300! maybe we see 3325 in a month or two!
https://blogs.worldbank.org/en/allaboutfinance/historical-lessons-chinas-monetary-policy-during-transition-1987-2006-central-bank#:~:text=In the late 1980s and,in 1994 (figure 1a).
China has infact devalued it's currency many times and has had many bouts of inflation.
They also have been increasing their money supply as fast, if not faster, than the US.
So your answer to Wingsrule question is not the correct answer.
Knowledge is the enemy of fear
Every country with a debt money system manipulates its currency.
http://ProofCollection.Net
$3300 kitco!
3325 kitco!
in just 5 calendar days! think we'll ever do $100 in a day?
Next few months or years we'll have an up $250 day. Maybe more than one.
kitco 3350!!
think we'll ever do $100 in a day?
That’s only about a 3% daily move, we’ll see it in the next month.
i was being sarcastic because that fast move up was followed by a fast move down. and a crawl up
kitco 3375 up over 85
Perhaps due to a 'little' uncertainty or escalation of things in Europe?
gold's moves aren't entirely coupled to the dollar or fear of us debt, but i'd say we're loosely trading on debt fears
kitco down then back up to 3375. almost hit 3400 a few trading days ago
Chart update. This is the same one I posted a while ago. I wasn't too far off with my projection, I just thought it would take longer.
Silver's kind of got an up-channel going. We're at the very top... breakout soon? I think it's time...
Platinum in the same situation. I think Platinum is ripe for a move.
http://ProofCollection.Net
3307 kitco!
where is my $100 day?!
3301.98 kitco!
any day now
We don't have to go to Europe to have uncertainty and escalation. 🤔😁
Seems like gold recently has developed a sense of normalcy. When the stock market goes up, gold goes down. The way it's supposed to be.
I'm still calling by 2028, the stock market will be up, possibly way up, while gold will be down or at best stagnant. That is unless a calamitous event takes place in the world, then all bets are off.
war? yay?
kitco 3400
futs 3425
Wow, I didn't think my line would be that spot on!
http://ProofCollection.Net
That was a great call back in April, as shown.
k 3434
f 3457
We'll see $300 moves in gold in a few years, maybe sooner.
I think we've had $150 moves so that wouldn't be a surprise this year.
I disagree and I'll tell you why.
The inverse relationship you cite is normal after the hypervolatility of early-April when the Tariff Tantrum dominated the financial markets for weeks.
I think both equities AND gold march higher. Gold has strong bidding underneath, and I would be shocked if my $5,000 by 2035 prediction doesn't come through. In fact, I'd say it's 50/50 that we hit it by 2030.
Yeah, I've been meaning to post the PL breakout.
http://ProofCollection.Net