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Federal Reserve holds $2 trillion in U.S. debt
cnsnews.com ^ | August 19, 2013 | Terence P. Jeffrey

Posted on 08/20/2013 7:56:29 AM PDT by Prospero

The Federal Reserve’s holdings of publicly traded U.S. Treasury securities—federal government debt—pushed above $2 trillion for the first time last week, hitting approximately $2,001,093,000,000 as of Aug. 14, according to the Fed’s latest weekly accounting.

The Fed’s accounting for the previous week showed that it had owned approximately $1,993,375,000,000 in U.S. Treasury securities as of Aug. 7.

Back on Dec. 31, 2008, before the Fed began its strategy of “Quantitative Easing," the Fed owned only $475.9 billion in U.S. Treasury securities. Since then, the Fed’s holdings of U.S. government debt have more than quadrupled

(Excerpt) Read more at cnsnews.com ...


TOPICS: Business/Economy; Constitution/Conservatism; Government; News/Current Events
KEYWORDS: debt; fed; federal; reserve; usdebt
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1 posted on 08/20/2013 7:56:29 AM PDT by Prospero
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To: Prospero

Actually I’m surprised. I would have assumed that the Fed was buying up most of the $5 or $6 trillion or so that Obama has stuck us with. Who else could buy up that much U.S. debt?


2 posted on 08/20/2013 7:58:34 AM PDT by InterceptPoint
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To: Prospero

What could go wrong?


3 posted on 08/20/2013 7:59:36 AM PDT by woodenickel
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To: Prospero

What could go wrong?


4 posted on 08/20/2013 7:59:36 AM PDT by woodenickel
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To: Prospero

The greatest Ponzi scheme in the annals of recorded human history. This is nothing more than a shell game. The Fed is acting like the water pumps on the Titanic. It can buy a little time perhaps. But the truth is the nation is already effectively bankrupt, drowning in an ocean of insurmountable debt. The Fed is simply covering up the true size of this mind boggling debt.


5 posted on 08/20/2013 8:01:02 AM PDT by Trapped Behind Enemy Lines
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To: Prospero

With Quantitative Easing (QE) the Fed just converts this debt into money and injects this into the economy. This in effect is no different than some banana republic just printing money that is increasingly worthless. The result thanks to Obama and the Fed we have trillions in new debt and through QE an eroding US dollar.


6 posted on 08/20/2013 8:07:28 AM PDT by The Great RJ
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To: Prospero

Sheer madness.


7 posted on 08/20/2013 8:16:38 AM PDT by headstamp 2 (What would Scooby do?)
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To: Prospero

We are bankrupt.

This is just Kabuki theater courtesy of the Fed to cover up that fact.


8 posted on 08/20/2013 8:18:30 AM PDT by headstamp 2 (What would Scooby do?)
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To: Prospero

Since the US has reached its lawful borrowing limit, how is it possible for the privately-held Fed to emit debt on behalf of American taxpayers?


9 posted on 08/20/2013 8:19:27 AM PDT by Sgt_Schultze (A half-truth is a complete lie)
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To: Trapped Behind Enemy Lines

So the Fed must get the interest from the bonds. What does it do with the money? Return it to Treasury?


10 posted on 08/20/2013 8:22:04 AM PDT by kabar
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To: Prospero

so...

the national debt doesn’t increase for 3+ months...

because the fed is ‘buying’ the debt by printing as much as they need.

yea, that’s just brilliant
/sarc


11 posted on 08/20/2013 8:23:42 AM PDT by sten (fighting tyranny never goes out of style)
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To: kabar

buy more bonds.


12 posted on 08/20/2013 8:26:12 AM PDT by Trapped Behind Enemy Lines
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To: Prospero

Eat it fed... yum yum... would you like some obama with your greens?


13 posted on 08/20/2013 8:36:02 AM PDT by LibLieSlayer (FROM MY COLD, DEAD HANDS!)
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To: Prospero

Anyone want to buy some tulips?


14 posted on 08/20/2013 8:40:02 AM PDT by Prospero (Si Deus trucido mihi, ego etiam fides Deus.)
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To: Trapped Behind Enemy Lines
They don't need the money to buy bonds. They can print it. The money is returned to the Treasury after paying for expenses. From the Fed website:

"Does the Federal Reserve operate using tax dollars?

The Federal Reserve's income is derived primarily from the interest on U.S. government securities that it has acquired through open market operations. Other sources of income are the interest on foreign currency investments held by the System; fees received for services provided to depository institutions, such as check clearing, funds transfers and automated clearinghouse operations; and interest on loans to depository institutions (the rate on which is the so-called discount rate). After paying its expenses, the Federal Reserve turns the rest of its earnings over to the U.S. Treasury.

15 posted on 08/20/2013 8:41:07 AM PDT by kabar
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To: Prospero

Are these $2T in T-Bills and QE dollars one in the same?


16 posted on 08/20/2013 8:45:50 AM PDT by IamConservative (The soul of my lifes journey is Liberty!)
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To: Prospero

Holy sh*t. I don’t know if we even make it to the 2014 elections.


17 posted on 08/20/2013 8:47:31 AM PDT by Lazamataz (Early 2009 to 7/21/2013 - RIP my little girl Cathy. You were the best cat ever. You will be missed.)
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To: Prospero

When this all crashes, the Federal Reserve (which is a group of banks) will own and possess all of our gold and a huge amount of real estate.

This is exactly how banks have prospered through the ages; loan money to countries until they overextend and collapse, then take possession of all the securities.

Oh yes, I forgot. Throw the inevitable war into this mix.


18 posted on 08/20/2013 8:51:36 AM PDT by DakotaGator (Weep for the lost Republic! And keep your powder dry!!)
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To: Prospero

It’s more like 200 trillion when you factor in future liabilities. Invest in guillotines.


19 posted on 08/20/2013 10:00:31 AM PDT by VRWC For Truth (Roberts has perverted the Constitution)
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To: kabar
...the Fed must get the interest from the bonds...

Actually they don't, that's not how the bond market works. 

They spent say, $2T for a stack of bonds with a total value at maturity of say, $2.2T.  The 200B profit is what they might eventually get instead of interest.  Or not.  If the plan is to raise interest rates when sell-time comes around, they may want to sell the bonds at a loss as a way to kick rates higher.

fwiw, right now the fed's holdings is ten percent total federal debt.  That's the same percent when Reagan was president.  So much for QE money printing.

20 posted on 08/20/2013 10:13:47 AM PDT by expat_panama
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