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Quantitative Easing
Alea — From the Fed: Q: Will these operations be reserve neutral? A: No, these operations will be financed through the creation of additional bank reserves. in FAQs: Purchasing Direct Obligations of Housing-Related GSEs Email This

Agency Debt
Across the Curve — ... Dealers expect that the Federal Reserve will notify them tomorrow that the Federal Reserve will purchase agency paper on Friday. The process will be conducted through the primary dealer network about once a week. The Federal Reserve will purchase fixed rate non callable senior debt.Spreads today were mixed. Two year spreads narrowed 2 basis points while 5 year and 10 year spreads were about 5 basis points wider. One trader with whom I speak felt that the underperformance of the 5 year sector and 10 year sector was a result of profit taking following the recent spread ...

Getting real
self-evident — ... in a computer). Now, why am I on this rant? The real value of a house depends on the real incomes of the people in the neighborhood and their willingness to spend their incomes on housing.  Period.  If the production of real wealth by people in the neighborhood — or in the county or in the state or in the nation or on the planet — is declining, then so will the real value of housing. As we all know, the Federal Reserve is about to create $100 billion to purchase mortgage-backed securities. Will these ...

Risk the Credit of the Republic for Homeowners
The Aleph Blog — ... 2) The Federal Reserve is buying up mortgage assets.  Now the Treasury is thinking of subsidizing mortgage rates.  Don’t we do enough in the US to overinvest in housing? ...

Quantitative easing, in practice
FT Alphaville — QED. FAQs: Purchasing Direct Obligations of Housing-Related GSEs Click through to details on the Fed’s plan to buy Frannie paper. The plan was ...

Wow, Quantitative Easing Here We Come...!!
Manhattan Real Estate: New York City Real Estate Tips — ... it is for this announcement. The fed could perform debt swaps or issue debt on the shorter end of the curve to finance such asset purchases, but right now, the fed has used its reserves of treasuries to finance lending activities. So, they click their mouse and POOF, a bank credit appears in the major money center banks' account (primary dealer) with the fed. Sound crazy? It is. Money created out of virtual 'thin air'. This is the gold trade by the way. Don't believe me? The New York Fed states it on their site in clear black & white: Q: Will these ...

Some meaty minutes
macroblog — ... balance sheet is likely to get bigger before it gets smaller, but it will get smaller. The planning for managing to a smaller balance sheet is under way. Whatever the future brings for the balance sheet, the time has not yet come to remove policy accommodation—either by adjusting the federal funds rate target, by removing the backstop of most liquidity programs, or by making adjustments in the FOMC's asset purchase programs (described here, here, and here). With respect to those asset purchase programs, the point is to improve ...

BondMarket Close September 01 2009
Across the Curve — ... The Federal Reserve motivated the tightening in agency spreads today by announcing a change in the manner in which it purchases agency securities. (This change is fodder for the grassy knoll crowd.) Until this point the Open Market Desk concentrated its purchases in off the run securities and avoided the on the run benchmark issues. ...