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All the us debt bonds they bought ie quantitative easing is now coming home to roost. Bonds are worth more at lower interest rates, with increased interest rate the amount of value the bond holds is less.
Today withe the discounted rate on us treasury or the amount of loss exceeds the actual capitalization of the fedeal reserve. They can print more money but that just makes situation worse, it is beginning of the end in debt spiral. Unless something big happens, IE trade war with China stops and they buy debt it will cost more each year to service interest only on debt.
Federal reseve quarterly statement look for your self
Fed bought officially around 4 trillion in bonds officially, that $66.5 billion unrealized loss is far greater than Fed’s razor-thin $39 billion in This means that, on a mark-to-market basis, the largest and most systemically important financial institution in the world is objectively insolvent.
(It’s also noteworthy that the Fed’s financial statements show a NET LOSS of $2.4 billion for the first nine months of 2018.
This is all truly remarkable… and highlights how utterly absurd the financial system is.
Pucker up this is going to get scary and in uncharted waters. -
Numbers have NEVER been my friends……but …..ah, hard for me to even make any comment. Even I know this has been coming…coming…and most of what they’ve done to kick the can down the road only makes the eventuality worse.
Are you saying they ran out of “road” for kicking?
OldMtWoman
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Pretty much sums it up reached the day of reckoning, problem is if us system goes down world will take a big hit they might be able to postpone it by extraordinary means never done before. But most likely it will be like eevery other place that has hit the wall, some big changes comming.
It’s predicted that up to 4 percent interest rates in near future the 66.5 billion loss was from a quarter percent raise. So you can see the issue each time interest goes up you pay more on debt and have to bail out fed for billions you don’t have.
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Its being discussed in many blogs that the next place the neofuedal government will look to cover their butts is private wealth. That means our savings accounts, 401Ks, IRAs, and similar investment instruments. To attempt to sweeten the theft we will be promised a lifetime annual income. Yeah, right. “The check is in the mail”.
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Yeah, well my check is in the mail but …..yanno? It’s kinda small. And those prices keep raising up. Not under any delusion that money in the bank…..is IN the bank. Nor is it always at my disposal. Nearly need someone “permission” to use it these days.
OldMtWoman …they’re gonna have to rewrite the economics books…
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I find it somewhat sad that there are so many people in this country that think the gov’t won’t take their money. They already take it. People have just become so accustomed to it they don’t even question it. Can’t opt out of social security taxes. You must give the gov’t your hard earned money with a promise you’ll get it back later. If you live long enough, if it doesn’t go broke, if you can wrangle your way through the red tape you might possibly get it. A financial disaster of this proportion will be disastrous when it occurs.
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This appeared in Zero hedge this morning. It appears to be another crack in the social foundation that leftist will make an effort to widen to create more division, animosity, and chaos between those who will be able to retire and the majority that will not. The vast majority of wealth in this country… and likely globally… is held in private hands. I think its reasonable to make an assumption that a some point the greedy government will foster a plan to take it. I wager they are already scheming how to go about it.
https://www.zerohedge.com/news/2018-12-15/festering-social-rift-over-pensions
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Concerning the ZH Pension fund Haves vs Have Nots article, I never understood why people keep putting their money into pension funds. Back in the day, when they were properly managed they were great.
Now, seems like gross mismanagement of those pensions are leading to shortfalls, cuts, and insolvency.
I would rather have control of my own money.
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I only keep enough in the bank to pay bills that need to be paid electronically. My saving were wiped out by my late ex-wifes medical bills, and I’m driving old cars that were paid off long ago. Still, more cash on hand would be a very good thing.
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