It's a bubble popping. The Fed is trying to gradually let the air out while still targetting mortgage rates. The predictable result is that the government owns more and more mortgages (leads to socialism, gives Barney more power, etc). The 10 years are still being bought by speculators who hope to sell to other speculators who hope that the Fed will buy more later. Otherwise 10 years would be much higher to reflect the fact that we have a terrible fiscal policy (sinilar to Japan in the 90's), taxes are being raised on job creators, government owns too much of the economy and wants more, etc.
And you'd put the money where?
I'd greatly lower the FDIC fees that are killing small banks (I get 0.25% on a savings account but my bank pays 0.50% in fees). That also makes up for the inflation hit on savers. I'd put money into Fannie and Freddie and then IPO them to make them private again. In short, anything but politician's bridges to nowhere or handouts to people to buy TV's, but instead money needed to stabilize and privatize the credit markets.
Is he popping it too quickly or too slowly or just right? And IIRC, he said he'd buy 10 years to keep the yield down, but the yields are rising. How can that be?
The predictable result is that the government owns more and more mortgages (leads to socialism, gives Barney more power, etc).
The government or the Fed?
The 10 years are still being bought by speculators who hope to sell to other speculators who hope that the Fed will buy more later.
But the Fed was buying as yields were rising.
I'd greatly lower the FDIC fees that are killing small banks
You'd have the Fed print money and give it to banks to pay the FDIC?
That also makes up for the inflation hit on savers.
Ahhh, print money, to counteract inflation. Good idea!
I'd put money into Fannie and Freddie and then IPO them to make them private again.
Interesting idea, but money from the Fed?