BILS - Is The Fed Monetizing America's Debt?

• When I stand back and consider what the Fed is actually doing, it leads me to the observation that they are actually monetizing America’s debt. In fact, in my view, they have been doing so ever since the financial crisis of 2008/2009.
• The Fed can, and does, buy maturities all along the yield curve, and so they can not only control interest rates, but the spreads between the shortest and the longest Treasury maturities. So, the Fed has taken over the control of the yield curve as well.
• The other methodology that the Fed is using to control the financial system is their “reverse repo operations.” They are draining money at the short end and affecting bank reserves, while pumping money into longer maturities.

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