Amount of cash at fed's disposal

Discussion in 'Economics' started by mkmps, Aug 17, 2007.

  1. mkmps

    mkmps

    i was trying to figure out the other day how much cash does fed "have" for market intervention? i mean can it ever run out? i was trying to come out at some number, but could not get to it in any reasonable logical manner. i guess given that USD is reserve currency for 3/4 of worlds oil it probably means that fed "spend" as much money as they deem nesseccary to make sure things are right? anyone know at what point fed's cash runs out?
     
  2. the Feds. can print it as fast as they can enter the amounts on the ledger.......

    the injections are money created out of thin air and blue smoke
     
  3. Pekelo

    Pekelo

  4. The Fed's "cash" runs out when people lose confidence in the dollar.
     
  5. mkmps

    mkmps

    i think USD could realistically be back to 1.20 ish range due to flight to quality in this latest shake out.

    i do think that so long people believe in USD, fed invincible, but at some number it should be theoretically possible to quantify people should turn.. i guess if Soros was younger maybe he could do some damage in current situation :)

    I mean we are off gold standart for a looong time now, but how do THEY know how much money is not too much in current world situation. Someone probably already already did their Phd on this - so please elaborate.

     
  6. Breaking the FED would involve a substantial level of risk for any one of the major hedge funds to accomplish alone. Because of the amount of capital our major hedge funds have, it would have to be a very concentrated bet. Concentrated a la Centaurus taking out Amaranth, but a fund 10-20x as big as Centaurus.

    In the mind of a large hedge fund manager, is it better to make a 20% performance fee on say a 30% annual return, or risk everything for a 20% performance fee on a 100% annual return?

    :D