Federal Reserve Surpasses 3 Trillion Dollar Balance Sheet

As of this week, the Federal Reserve has officially gone over $3 trillion in its balance sheet. It is buying MBS and bonds as promised. Of course this has consequences as I pointed out here. The euro made a 1 year high against the U.S. dollar. U.S. bond yields are breaking resistance at 1.92% yield on the 10 year treasuries.What's very odd is that the gold price keeps languishing. A weak dollar environment should be very bullish for gold.Chart 1:...

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Fed has started QE3

It seems that the Federal Reserve has finally jump-started the QE3 program.Mortgage backed securities went up from $852 billion to $893 billion in the month of November 2012. That's a $40 billion increase, precisely right on schedule according to its press release in September 2012, where it stated to buy $40 billion in MBS's each month.Chart 1: Federal Reserve Balance SheetChart 2: S&P 500If we put together Chart 1 and Chart 2, we can find a...

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A Detailed Federal Reserve Balance Sheet

Just by having heated (and uncomfortable) discussions with seekingalpha commenters I learn new things. This is what you get when you write financial articles without any financial background.But there are positive things coming from discussions.Today I found a very nice interactive chart to follow the Federal Reserve's balance sheet (Chart 1).You can play with the interactive chart here:http://clevelandfed.org/research/data/credit_easing/index.cfmChart...

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The Simplified Bank Stress Test

Bloomberg reported on 20 August 2012 that banks are stepping up their U.S. treasury buying. As deposits increased 3.3% to $US 8.88 trillion in the two months ended July 31 2012, business lending rose 0.7% to $US 7.11 trillion, Federal Reserve data show. This inherently means that banks aren't lending money to the private sector, but are lending their money to the U.S. government. Peter Schiff pointed this out on the Peter Schiff Show of 20 August...

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Spain is following Greece in its path to bankruptcy

The situation in Spain is looking worse every day. I believe Spain is following the path of Greece into bankruptcy.Let's take a look at the Spanish bond yields. At the end of 2011 we got the massive ECB bailout package named Long Term Refinancing Operation (LTRO). This relieved the bonds of certain peripheral governments like Italy, Greece and Spain. Lately though, with many Spanish regions on the verge of bankruptcy, Spanish bond yields...

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