Ohhhhh, I do *not* like this! Volume in the ES is 1/2? 1/3? of a typical opening. Is this the Trumpet speaking before a global audience? Is this the market catching on to the fact that FED balance sheet reductions will likely commence with tomorrow's announcement?? Or does it mean nothing? ("Tom ol'man. You're a frikken paranoid. Sit back down. Hand off the mouse.")
I had internet issues this morning, and I was just told I didn't miss anything. I guess this thread confirms that.
They inflated the economy (QE) by buying government securities and mortgage backed paper...they will begin to sell and not roll over
Whoa! The pundits are saying... "The markets had 'basically' no reaction to Pres. Trump's speech....." No. "Wrong." While the S&P has barely moved, my SEP22 SPX positions have dropped a goodly 10% in the last 10 minutes. WOOT!! I'm short at 2520/30, and on bottom, at 2490/80 and 2485/75 -- about evenly. So, *roughly*, both top and bottom sides just exhaled a nice, relaxing "Ahhhh-hhhhh." Vz: Recalling you're not US-based, "eh"? So... As part of the FED's handling of the "financial crisis," they commenced buying US Treasuries and other securities as a way to take risk-free/low-risk securities off the market, and leave a *smidge* of portfolio-usage for equities (and other market-risk) securities, and thereby putting a floor under the financial market with something besides a lower interest rate. (Ooop -- taken to 0%.) All these securities took the FED balance sheet from a relatively low amount (which I totally forget) to upwards of US$3T-US$4T. "Big money." Thus, with "The Unwinding" of that balance sheet, the low risk market would need to absorb trillions of dollars of asset, *without* causing lower-risk bonds to sink, 'widows&orphans' lower-risk equities to follow, and the whole capital market swoon again. {!!!}. Hence, the worry. But I haven't seen this given much attention. But then too, LOW volume today. Sheeesh. (So, how'd I do?) [HA! I am such the academic. Speedo said what I wished to, in a sentence. That is just embarrassing.]
I knoooow... there are no dumb questions.... but here's a dumb one. Did they buy regular securities? I mean like say FB and NFLX and others. P&G etc. 2nd dumb question... are we not allowed to look at what they own?
Assuming that the above analysis will come to fruition. Then buying TBT, TMV and TTT be the way to go right?
A good understanding... https://www.brookings.edu/blog/up-f...chins-center-explains-the-feds-balance-sheet/ A good update... http://www.marketwatch.com/story/fe...ent-of-truth-for-financial-markets-2017-09-18 A good Original Source view... https://www.federalreserve.gov/monetarypolicy/quarterly-balance-sheet-developments-report.htm