What happens next with the Fed's $9 trillion balance sheet?

finance.yahoo2021-12-21

Since the pandemic began, the nation’s central bank has aggressively printed trillions of dollars to keep the U.S. economy afloat. Doing so has ballooned the Federal Reserve’s balance sheet to nearly ...

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Comments

robot1234
2021-12-22
robot1234
As more countries see the abuses done by US using USD as global reserve currency, concerted efforts will come into play to bypassing the use of USD for global trades
- PearlynCSY:
  Recent Biden's Democracy Summit of Democracy vs Autocracy could be a watershed event that finally triggered many more countries to use other alternative currencies instead of the USD
th0mastan
2021-12-21
th0mastan
All the money has been out there, eventuallyit will have to go somewhere. This is the key reason why properties, cryptos are going higher and higher.
Wuqian98
2021-12-21
Wuqian98
Like
Yannick
2021-12-21
Yannick
Like pls.
Tendollar
2021-12-21
Tendollar
Wat will happen to the stock mkt if Fed start to unwinding its balance sheet?
R Lim
2021-12-21
R Lim
Ok
- orrox:
  ok

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Doing so has ballooned the Federal Reserve’s balance sheet to nearly ...</p>\n\n<a href=\"https://finance.yahoo.com/news/quantitative-tightening-federal-reserve-9-trillion-balance-sheet-113743366.html\">Source Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","isBrief":false,"type":0,"news_type":1,"symbol":".SPX","symbol_name":"S&P 500 Index","start_time":0,"source_url":"https://finance.yahoo.com/news/quantitative-tightening-federal-reserve-9-trillion-balance-sheet-113743366.html","article_id":"1109474932","we_media_id":null,"thumbnails":[],"rights":null,"url":"https://stock-news.laohu8.com/highlight/detail?id=1109474932","pubTimestamp":1640089479,"sourceInfo":{"source_id":"lsy1612507957220","name":"finance.yahoo"},"weMediaInfo":null,"summary":"Since the pandemic began, the nation’s central bank has aggressively printed trillions of dollars to","collect":0,"end_time":0,"defaultTopTitle":"yahoo.com","property":[],"viewcount":null,"language":"en","relate_stocks":{".SPX":"S&P 500 Index",".IXIC":"NASDAQ Composite",".DJI":"道琼斯"},"translate_title":"美联储9万亿美元的资产负债表接下来会发生什么？","themeId":null,"isJumpTheme":false,"ttsUrl":null,"symbols_score_info":{".DJI":0.9,".IXIC":0.9,".SPX":0.9},"content_text":"Since the pandemic began, the nation’s central bank has aggressively printed trillions of dollars to keep the U.S. economy afloat. Doing so has ballooned the Federal Reserve’s balance sheet to nearly $9 trillion.\nFed officials, acknowledging the rising risks posed by inflationary pressures, are now starting to think about whether or not they can move to shrink the central bank’s holdings next year.\n“I have no idea what a normal balance sheet looks like anymore,” said Federal Reserve Governor Christopher Waller on Dec. 17.\nSince the depths of the pandemic, the Fed has been buying U.S. Treasuries and agency mortgage-backed securities in the open market. Those purchases, in a process often referred to as “quantitative easing,” serve as a signal to markets that the Fed is serious about its intention to keep financing conditions loose.\nIn November, the Fed kicked off the process in slowing the pace of those purchases, which it had been running at a clip of about $120 billion per month. After a print on inflation showing the fastest pace of price increases since 1982, the Fed moved on Dec. 15 to more quickly draw down its purchases.\nWhen the Fed brings the quantitative easing program to a full stop around March, policymakers will then turn their eyes to raising interest rates (from the current setting of near zero) — and perhaps an unwinding of its balance sheet. The Fed signaled the likelihood of three interest rate hikes next year, a more aggressive path than Fed watchers had originally expected.\n“In light of this slightly earlier timing of hikes and Powell’s comment that differences with the economic situation last cycle could influence thinking about balance sheet policy,” wrote Goldman Sachs Economics in a note.\nWall Street analysts are pulling forward their expectations for when the Fed would start “quantitative tightening,” the process of shrinking the balance sheet by allowing maturing securities to “roll off” (as opposed to reinvest in new securities).\nDeutsche Bank, which originally expected the Fed to start the balance sheet unwind in the third quarter of 2023, now expects that process to begin in the “back half of next year.” Goldman Sachs had originally forecast a start date in the first half of 2023, but now expects quantitative tightening to begin in the fourth quarter of next year.\nWhat has the Fed said?\nFed Chairman Jerome Powell punted on the question of balance sheet strategies when he was asked about it following the Fed’s most recent policy-setting meeting.\n“Didn’t make any decisions today,” said Powell on Dec. 15, adding that the Fed will deliberate on the timing of any balance sheet runoff in coming meetings.\nBut Powell’s colleagues are beginning to speak openly about exactly how they’d like to see the balance sheet handled.\n“I think we could start reducing the balance sheet not too long after liftoff,” Waller said at an event on Dec. 17, referring to the “lifting off” from near-zero interest rates. Markets are bracing for the possibility of that first interest rate hike to happen as early as March.\nWaller added that he would like to see the Fed balance sheet, which is about 35% of total U.S. GDP, reduced to “something like 20%,” which would be roughly $6 trillion.\nThe Fed has only attempted to reduce the size of its balance sheet once in the modern era of quantitative easing. After almost three years of holding the balance sheet at roughly $4.5 trillion, the Fed moved in late 2017 to begin unwinding its asset holdings.\nThat process abruptly ended in 2019, in the face of economic downside risks associated with the U.S.-China trade war. The COVID-19 pandemic only a few months later would push the Fed back into again expanding its balance sheet.\nThe Fed appears to be in the early stages of thinking about how it might be able to pull it off next year, suggesting it may not wait as long as it did last time.\nBut the Fed is also aware that it does not want to surprise markets.\n“In dealing with balance sheet issues, we've learned that it's best to take a careful sort of methodical approach to make adjustments. Markets can be sensitive to it,” Powell said on Dec. 15.","kind":"news","is_publish_news":true,"is_publish_highlight":true,"is_publish_live":false,"is_publish_wemedia":null,"editions":null,"column":"","sentiment":"0","news_tag":"","news_rank":0,"symbols":[],"gpt_button":1},"commentList":[{"id":691954536,"gmtCreate":1640130155947,"gmtModify":1676532408499,"author":{"id":"3561596430587504","authorId":"3561596430587504","name":"robot1234","avatar":"https://static.laohu8.com/default-avatar.jpg","vip":1,"hat":"https://static.tigerbbs.com/b0a2963eb37c60c5d6d4a8dbcd266952","crmLevel":6,"crmLevelSwitch":1,"idStr":"3561596430587504","authorIdStr":"3561596430587504"},"htmlText":"As more countries see the abuses done by US using USD as global reserve currency, concerted efforts will come into play to bypassing the use of USD for global trades","listText":"As more countries see the abuses done by US using USD as global reserve currency, concerted efforts will come into play to bypassing the use of USD for global trades","text":"As more countries see the abuses done by US using USD as global reserve currency, concerted efforts will come into play to bypassing the use of USD for global trades","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":2,"commentSize":1,"repostSize":0,"link":"https://ttm.financial/post/691954536","repostId":1109474932,"repostType":4,"isVote":1,"likeStatus":false,"favoriteStatus":false,"reportStatus":false,"tweetType":1,"comments":[{"id":100183461,"gmtCreate":1641941111719,"gmtModify":1663242250143,"authorId":4092458811577680,"author":{"id":4092458811577680,"idStr":"4092458811577680","authorId":4092458811577680,"name":"PearlynCSY","avatar":"https://static.tigerbbs.com/b3e9fe7af061efe80a756d23de62e7b3","vip":1,"crmLevel":4,"crmLevelSwitch":1,"individualDisplayBadges":[]},"repliedAuthorId":0,"objectId":691954536,"type":1,"supId":0,"prevId":0,"content":"Recent Biden's Democracy Summit of Democracy vs Autocracy could be a watershed event that finally triggered many more countries to use other alternative currencies instead of the USD","text":"Recent Biden's Democracy Summit of Democracy vs Autocracy could be a watershed event that finally triggered many more countries to use other alternative currencies instead of the USD","html":"Recent Biden's Democracy Summit of Democracy vs Autocracy could be a watershed event that finally triggered many more countries to use other alternative currencies instead of the USD"}],"langContent":"CN"},{"id":691069566,"gmtCreate":1640098805572,"gmtModify":1676532404829,"author":{"id":"3573383537150312","authorId":"3573383537150312","name":"th0mastan","avatar":"https://static.tigerbbs.com/84d76bcdad50787fa2929139725c46f0","vip":1,"crmLevel":5,"crmLevelSwitch":0,"idStr":"3573383537150312","authorIdStr":"3573383537150312"},"htmlText":"All the money has been out there, eventuallyit will have to go somewhere. This is the key reason why properties, cryptos are going higher and higher.&nbsp;","listText":"All the money has been out there, eventuallyit will have to go somewhere. This is the key reason why properties, cryptos are going higher and higher.&nbsp;","text":"All the money has been out there, eventuallyit will have to go somewhere. This is the key reason why properties, cryptos are going higher and higher.","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":0,"commentSize":0,"repostSize":0,"link":"https://ttm.financial/post/691069566","repostId":1109474932,"repostType":4,"isVote":1,"likeStatus":false,"favoriteStatus":false,"reportStatus":false,"tweetType":1,"langContent":"CN"},{"id":9000811554,"gmtCreate":1640093447352,"gmtModify":1676533500626,"author":{"id":"4101372154330430","authorId":"4101372154330430","name":"Wuqian98","avatar":"https://static.tigerbbs.com/9284b1218b2034d87a05e8a145005238","vip":1,"crmLevel":2,"crmLevelSwitch":0,"idStr":"4101372154330430","authorIdStr":"4101372154330430"},"htmlText":"Like","listText":"Like","text":"Like","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":1,"commentSize":0,"repostSize":0,"link":"https://ttm.financial/post/9000811554","repostId":1109474932,"repostType":4,"isVote":1,"likeStatus":false,"favoriteStatus":false,"reportStatus":false,"tweetType":1,"langContent":"EN"},{"id":691008389,"gmtCreate":1640092977901,"gmtModify":1676532403313,"author":{"id":"3575024004895861","authorId":"3575024004895861","name":"Yannick","avatar":"https://static.tigerbbs.com/b8bcd137597d0a92ada6ef564b84dd48","vip":1,"crmLevel":3,"crmLevelSwitch":0,"idStr":"3575024004895861","authorIdStr":"3575024004895861"},"htmlText":"Like pls.","listText":"Like pls.","text":"Like pls.","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":1,"commentSize":0,"repostSize":0,"link":"https://ttm.financial/post/691008389","repostId":1109474932,"repostType":4,"isVote":1,"likeStatus":false,"favoriteStatus":false,"reportStatus":false,"tweetType":1,"langContent":"CN"},{"id":691001238,"gmtCreate":1640092922175,"gmtModify":1676532403304,"author":{"id":"3574249039232152","authorId":"3574249039232152","name":"Tendollar","avatar":"https://static.tigerbbs.com/f605c975630017596221e6b84fd5350f","vip":1,"crmLevel":4,"crmLevelSwitch":0,"idStr":"3574249039232152","authorIdStr":"3574249039232152"},"htmlText":"Wat will happen to the stock mkt&nbsp;if Fed start to unwinding its balance sheet?","listText":"Wat will happen to the stock mkt&nbsp;if Fed start to unwinding its balance sheet?","text":"Wat will happen to the stock mkt if Fed start to unwinding its balance sheet?","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":1,"commentSize":0,"repostSize":0,"link":"https://ttm.financial/post/691001238","repostId":1109474932,"repostType":4,"isVote":1,"likeStatus":false,"favoriteStatus":false,"reportStatus":false,"tweetType":1,"langContent":"CN"},{"id":693778038,"gmtCreate":1640090808206,"gmtModify":1676532403053,"author":{"id":"3581634125853828","authorId":"3581634125853828","name":"R Lim","avatar":"https://static.tigerbbs.com/d3081d4d67e2198188bc8039305c484f","vip":1,"crmLevel":3,"crmLevelSwitch":0,"idStr":"3581634125853828","authorIdStr":"3581634125853828"},"htmlText":"Ok","listText":"Ok","text":"Ok","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":2,"commentSize":1,"repostSize":0,"link":"https://ttm.financial/post/693778038","repostId":1109474932,"repostType":4,"isVote":1,"likeStatus":false,"favoriteStatus":false,"reportStatus":false,"tweetType":1,"comments":[{"id":7066719,"gmtCreate":1640092849739,"gmtModify":1663239002733,"authorId":3566183313072109,"author":{"id":3566183313072109,"idStr":"3566183313072109","authorId":3566183313072109,"name":"orrox","avatar":"https://static.tigerbbs.com/d63eb4c08ebc58d4fd3cc57ed0a98e83","vip":1,"crmLevel":2,"crmLevelSwitch":0,"individualDisplayBadges":[]},"repliedAuthorId":0,"objectId":693778038,"type":1,"supId":0,"prevId":0,"content":"<u>ok</u>","text":"<u>ok</u>","html":"<u>ok</u>"}],"langContent":"CN"}],"isCommentEnd":false,"newsSizeData":{"likeSize":68,"commentSize":9,"repostSize":0,"favoriteSize":0,"likeStatus":false,"favoriteStatus":false},"APP":{"userAgent":"Mozilla/5.0 AppleWebKit/537.36 (KHTML, like Gecko; compatible; ClaudeBot/1.0; +claudebot@anthropic.com)","isDev":false,"isTTM":true,"deviceId":"web-server-community-laohu8-v3","version":"4.29.3","shortVersion":"4.29.3","platform":"web","vendor":"web","appName":"ttm","isIOS":false,"isAndroid":false,"isTiger":false,"isTHS":false,"isWeiXin":false,"isWeiXinMini":false,"isWeiBo":false,"isQQ":false,"isBaiduSwan":false,"isBaiduBox":false,"isDingTalk":false,"isToutiao":false,"isOnePlus":false,"isHuaWei":false,"isXiaomi":false,"isXiaomiWebView":false,"isOppo":false,"isVivo":false,"isSamsung":false,"isMobile":false},"href":"/m/news/1109474932"}