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lquadland10 (< 20)

Teach me please.

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September 17, 2009 – Comments (9) | RELATED TICKERS: GS , AUY

I was flippen through the CFR News channels and chanced across Glen Beck Talking about the Treasury auction off 7 yr notes and a party buys it. Good. Then the I think the NY Fed buys it from the middle man. Does this Mean that The treasury can't sell our debt to other countries and they do this to lul people in a everything is ok? What does it mean when they talk about the IMF Monetizing the National Debt?

9 Comments – Post Your Own

#1) On September 17, 2009 at 2:47 PM, eldemonio (98.65) wrote:

I am no expert is these matters, but I will attempt to answer some of your questions.

As far as the IMF monetizing the national debt - Monetizing debt means that an entity prints money to pay down a debt.  The IMF has been encouraged by the G20 to monetize countries' national debts in order to avoid a deeper global recession.  One of the unfortunate outcomes of monetizing debt is inflation, and if the IMF goes through with this, global inflation. 

The US has also resorted to monetizing its debt as shown with the FED's recent purchase of bonds and super sneak agreements to monetize any bonds bought by third party buyers.  This is surely a sign of desperation.

I in no way want to be labeled as a Debbie Downer, Doom and Gloomer, or Kirk Cameron, but these actions will undoubtedly affect the $ in a negative way.

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#2) On September 17, 2009 at 2:50 PM, 1315623493 wrote:

When you see Glenn Beck on your tv, turn it off.

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#3) On September 17, 2009 at 2:57 PM, jason2713 (< 20) wrote:

Then the I think the NY Fed buys it from the middle man. Does this Mean that The treasury can't sell our debt to other countries and they do this to lul people in a everything is ok?

 

The long and short of it...YES is your answer.

The gov't is playing a dangerous game with bonds and the economy.

If they don't get any more buyers of bonds,  they will be cut from credit.

Boy, isn't karma a bitch!?

 

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#4) On September 17, 2009 at 3:17 PM, cdulan (90.94) wrote:

My answer is NO. This is not a case where the Fed can't sell to other countries.  The problem the Fed is addressing is that they cannot sell their debt to other countries AT THE PRICE THEY WANT TO SELL.  So they use their own balance sheet to artificially create demand in the market.

What does this do for us?  Well, there is an immediate loss on the sale and buy back by the Fed, but the support of the Treasury instrument rates helps keep our mortgage market liquid by keeping mortgage rates low and affordable to those brave enough to buy a house right now.  The Fed would rather support the national housing market than worry about accounting losses on it's balance sheet.  The housing market is the most dangerous thing threatening our recovery so I think Bernanke has his eye on the right issue.  I just may not agree with this approach to the solution.

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#5) On September 17, 2009 at 3:28 PM, lquadland10 (< 20) wrote:

Thank you.

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#6) On September 17, 2009 at 4:12 PM, Starfirenv (< 20) wrote:

"Does this Mean that The treasury can't sell our debt to other countries and they do this to lul people in a everything is ok?"

Short answer, Yes, pretty much.

From #4--   "The Fed would rather support the national housing market than worry about accounting losses on it's balance sheet."

 Short question-  Would that be the Private, for profit  Fed that I'm thinking of?  If this were true, would we be in this mess now? 'More worried about the housing mkt than their balance sheets?' I think this was meant as an honest question. Watch Beck!!  And listen to #1. +1 rec. Havn't laughed that hard all week.

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#7) On September 17, 2009 at 4:27 PM, guiron (22.47) wrote:

Watch Beck!!

What are his credentials and performance history in regards to financial markets and the economy? If you don't have a good answer for that question, you have zero reason to take anything he says about it seriously.

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#8) On September 17, 2009 at 9:12 PM, Starfirenv (< 20) wrote:

CDulan, Well?
Guiron, sounds like maybe you work for ACORN?
Iquadland10-- Listen to everything, knowledge is power, but do your own thinking. I still say, go with #1. Still LMAO. Fools?

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#9) On September 18, 2009 at 12:10 PM, lquadland10 (< 20) wrote:

lol I did say flipping through the Council of Foreign Relations member CNN MSNBC and Fox. LOL See..... I can still make people laugh. An no I do not work for Acorn just a bookstore. LOL

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