The Fed Bought No Corporate Bonds In August (None, Zero, Zilch)

Discussion in 'Economics' started by Amatrue, Sep 13, 2020.

  1. Amatrue

    Amatrue

  2. SunTrader

    SunTrader

  3. piezoe

    piezoe

    ??????????????!!!!!!!!!!!!!!!!!!!! What. Why would they.. what's special about August. A hundred billion or so and you've pretty much done what you can to help. They said they would help out a bit after the CARES Act authorized it. But they didn't say they would buy anything that came along forever. The fed normally doesn't buy corporate bonds. If I had to guess, I'd say the Fed isn't really buying any of them. They are probably just acting as the Treasury's Banker, which they are. Chances are the fed is acting only as the Treasury's agent. The bond ownership will probably be transferred to the Treasury, similar to the way the purchase of GM Stock was handled during the financial crisis.

    [Don't tell anyone, because it is a deep dark secret, but the fed and Treasury are really just different sides of the same coin.]
     
    Last edited: Sep 13, 2020
    Nobert likes this.
  4. xandman

    xandman

    The market moved on jawboning alone. They are keeping their powder dry. So many issues came to market this summer and the market absorbed it.

    Additionally, Why use the funds on corporates when we just had a massive rally in equities?
     
    apdxyk, Pricechange, piezoe and 3 others like this.
  5. All good - I was buying them. Carry on.
     
  6. I am wondering if the Fed has paused all market operations (normal scheduled treasury bond auctions excluded) until after the election. Market seems to think so as of Sept 1. Wednesday will be interesting specially without the stimulus money that was slated. This would all suggest selling is in order until after the election.
     
  7. easymon1

    easymon1