Minutes Signal Fed to Shrink Balance Sheet by $95B/Month

The Federal Reserve signaled it will reduce its massive bond holdings at a maximum pace of $95 billion a month, according to the minutes of the policy-setting Federal Open Market Committee's March meeting. Mike McKee reports on "Bloomberg Markets: The Close."

[williams]

That mindset helped me make more money investing. For example last year I invested 80k in stocks (with the help of my Financial Advisor of course) and made about 246k, but guess what? I put it all back and traded with her again and now I'm rounding up close to a million.

[hRtkuojTtmk]

Fed’s Inflation Narrative:
Inflation 4%: It’s a little higher than our target rate, but surely transitory.
Inflation 5%: Oh yes, it’s definitely transitory. Just supply chain issues.
Inflation 6%: It is persistently transitory, but it will fall heavily on its own in Q3.
Inflation 7%: Inflation has peaked.
Inflation 7.5%: It's the top now. It’s just a semi-conductor shortage.
Inflation 7.9%: This is really the top for sure. We got this. So we’ll hike interest rates by 0.25%.
Inflation 8.5%: C’mon, this can’t be real.
Inflation 10%: Nothing to worry about. It’s to be expected with war in Europe and lockdowns in China. Plus the market has already priced it all in.
Inflation 12%: There is no way this is not the TOP now!
Inflation 15%: OK, you win, just make it stop… Please…
Inflation 20%: Don’t make us go Volker on you now!!!

[behrensf]

first it was the money printer, now it's the money vacuum cleaner...

[T__F]

At that rate it will take the FED almost 4 years to clean up the 3.97 Trillion it has on it's balance sheet.

But who's going to buy the 1 Trillion plus in deficit spending each fiscal year, while the FED is trying to sell of a Trillion/yr in assets?

[jimbojimbo]

I dont get why people are mad

This is a necessary step, yes its tough but interest rates have to go up

[davep]

The self-proclaimed "courageous to act" Bernanke testified he would shrink the balance sheet considerably also but it never happened and I won't be surprised if it never does.

[adriansofia]

He and the rest of that circus will go down as the biggest clowns in HISTORY. 🤷🏻‍♂️🤦🏻‍♂️

[brutebiz]

We really need half a dozen 50 basis point hikes this year. I doubt that will be enough to make much of a difference. Regardless, the Fed doesn't have the chops to implement more than one 50 basis point hike this year, if they even do that.

[tankcvc]

That’s literally nothing when comparing it to size of their overall balance sheet, fed once again not giving a damm about the dollar

[truepersona]

Good job before the market crashes that is a wise decision but four years TOO LATE. Good luck with that.

[Dinngg]

Cut rates and keep cutting until the market crashes. Then you'll know when it's been enough,

[jeffmahoney]

its been 2.5 months and they've reduced by 5B total lol

[talldog]

Good luck trying to tame inflation. The cat is out of the bag.

[ahmedalsharman]

Lol they printed 4 trillions, and now shrinking by 95 bilions 😅🤣😅 it will take them 1000 years to get back to normal monetary policy..

[JESUSLIVESAMEN]

Sounds like a market crash is imminent

[johnstibal]

The last time rates got above 125 basis point, the markets wrenched lower and lower until finally crashing as rates hit around 200 basis points. Then, impotent powell cut rates 50% claiming no inflation. How high will impotent powell get rates this time?

[netstarr]

It's nine TRILLION DOLLARS WHAT IS THE REDUCTION? The interest?.

[TheAtiesWhat]

Fed says max $95 this article says will be $95...

[joachimlindback]

What is the total amount of the "balance sheet"?

[cooldudecs]

Inflation is necessary to pay back debts… either that or default and economic collapse your choice