“John Smith” sent this: Bailout Banks Buying Treasuries Help Keep Rates Low. John’s comment: “This article illustrates how the Fed has cleverly ‘deputized’ banks to do its dirty work. Through a combination of very cheap funding (due to Fed policies) and lack of other attractive places to deploy money, banks have been encouraged to buy huge amounts of longer-term treasuries, effectively doing the Fed’s Quantitative Easing for it. So Quantitative Easing is alive and well, even if the Fed is just playing the role of central planner, not buyer in chief. That’s some slick sleight of hand by Chairman Ben. But I think the end result will be the same, as long as the US still has more debt to issue – when banks can’t keep buying, either yields will have to rise massively (killing the “recovery”), or the Fed will have to step in and monetize the debt (sparking inflation).
The next four items are courtesy of Karen H.:
Obama Officials Eye More Jobless Aids, Weigh Taxes “The New York Times reported on Sunday that up to 1.5 million Americans will exhaust their unemployment benefits in coming months, pushing more into home foreclosures and destitution.”
Items from The Economatrix:
Marty Weiss: The “X” List: Weakest Banks and Insurers It lists s2,688 banks with “D” ratings or worse. Is one of them yours?
Two Obama Officials: No Guarantee Your Taxes Won’t Go Up Geithner: “People have to understand we have to bring those deficits down” JWR’s Corrected Headline: We Guarantee That Your Taxes Will Go Up
Greenspan: Housing Could Take Another Turn Downward
For Retirement Savings, Employees Increasingly on Their Own 40% of 401(k) plans have stopped, reduced, considered suspending matches
Commodities Add to Recent Gains as Dollar Sinks JWR’s Comment: We can expect a drop in the US Dollar Index (USDI) below the magic 72 level in the next few months. Spot silver and gold will benefit, correspondingly.