U.S. CitiesCity-Data Forum Index
Go Back   City-Data Forum > General Forums > Economics
 [Register]
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
View detailed profile (Advanced) or search
site with Google Custom Search

Search Forums  (Advanced)
Reply Start New Thread
 
Old 11-13-2019, 06:06 AM
 
3,014 posts, read 1,970,038 times
Reputation: 6789

Advertisements

Quote:
Originally Posted by TwoByFour View Post
In 2017 the Federal Reserve held $2.54 trillion in US Treasuries. In 2018 that had decreased to $2.30 trillion for a net loss of $240 billion. In other words they sold that amount of US Treasuries. The US deficit in that period was $780 billion. So the Fed sold rather than bought securities and did not at all buy all the US deficit.

The Fed is not buying US debt and the Chinese and Japanese , who have been huge consumers of debt, are selling, not buying, and this is actually a huge problem for the US. It is going to drive bond yields up to attract buyers which means even more debt to service the interest on those bonds. For long term investors high interest is good but mortgages and other consumer debt will become more expensive.
You say the Fed is selling and the Chinese and Japanese are also selling and not buying....

But...someone bought to absorb those 240 billion of fed decline. Someone bought to fund the 780 billion deficit.
Reply With Quote Quick reply to this message

 
Old 11-13-2019, 08:41 AM
 
9,609 posts, read 4,219,703 times
Reputation: 1870
Quote:
Originally Posted by TwoByFour View Post
In 2017 the Federal Reserve held $2.54 trillion in US Treasuries. In 2018 that had decreased to $2.30 trillion for a net loss of $240 billion. In other words they sold that amount of US Treasuries. The US deficit in that period was $780 billion. So the Fed sold rather than bought securities and did not at all buy all the US deficit.

The Fed is not buying US debt and the Chinese and Japanese , who have been huge consumers of debt, are selling, not buying, and this is actually a huge problem for the US. It is going to drive bond yields up to attract buyers which means even more debt to service the interest on those bonds. For long term investors high interest is good but mortgages and other consumer debt will become more expensive.
Japan is still a net buyer, as is the world. And as the world expands it will most likely continue to be a net buyer, as there is no other good replacement for the necessary volume of UST debt paper.

https://ticdata.treasury.gov/Publish/mfh.txt
Reply With Quote Quick reply to this message
 
Old 11-13-2019, 09:12 AM
 
9,002 posts, read 9,640,938 times
Reputation: 7631
Quote:
Originally Posted by TwoByFour View Post
In 2017 the Federal Reserve held $2.54 trillion in US Treasuries. In 2018 that had decreased to $2.30 trillion for a net loss of $240 billion. In other words they sold that amount of US Treasuries. The US deficit in that period was $780 billion. So the Fed sold rather than bought securities and did not at all buy all the US deficit.

The Fed is not buying US debt and the Chinese and Japanese , who have been huge consumers of debt, are selling, not buying, and this is actually a huge problem for the US. It is going to drive bond yields up to attract buyers which means even more debt to service the interest on those bonds. For long term investors high interest is good but mortgages and other consumer debt will become more expensive.
Not sure about China but Japan has been a net buyer of US debt recently.

ETA - sorry Hoonose beat me to the punch.
Reply With Quote Quick reply to this message
 
Old 11-13-2019, 10:57 AM
 
Location: Haiku
6,222 posts, read 3,142,007 times
Reputation: 8858
Quote:
Originally Posted by Thatsright19 View Post
You say the Fed is selling and the Chinese and Japanese are also selling and not buying....

But...someone bought to absorb those 240 billion of fed decline. Someone bought to fund the 780 billion deficit.
Most of that Fed decline was previous debt that matured and was retired. But the Fed chose not to repurchase new debt with the money they made off the old debt.

New debt is increasingly being bought by American investors. And the biggest purchaser of US debt is still the US government. Social Security and Medicare hold a lot of it.
Reply With Quote Quick reply to this message
 
Old 11-13-2019, 11:04 AM
 
Location: Haiku
6,222 posts, read 3,142,007 times
Reputation: 8858
Quote:
Originally Posted by EDS_ View Post
Not sure about China but Japan has been a net buyer of US debt recently.

ETA - sorry Hoonose beat me to the punch.
Japan has ticked back up in 2019 in their ownership of US debt but as a percentage of total debt ownership they are declining as are the Chinese. Japan has gone from owning 6% of total US debt in 2016 to about 5% in 2019.
Reply With Quote Quick reply to this message
 
Old 11-13-2019, 11:15 AM
 
Location: Haiku
6,222 posts, read 3,142,007 times
Reputation: 8858
Quote:
Originally Posted by Hoonose View Post
Japan is still a net buyer, as is the world. And as the world expands it will most likely continue to be a net buyer, as there is no other good replacement for the necessary volume of UST debt paper.
US debt is still attractive because it is viewed as zero risk. But it is losing appeal because of low interest rates. As buyers retract, yields will have to climb in order to sell the debt. Rising interest rates are great for investors but private debt will follow suit so eventually it will slow the economy. US interest rates are still determined by market forces.
Reply With Quote Quick reply to this message
 
Old 12-09-2019, 11:57 PM
 
Location: Sector 001
7,326 posts, read 6,748,488 times
Reputation: 8468
The higher up the wealth-power pyramid the observer is, the more prone they are to a magical-thinking belief that the empire is forever, even as it is crumbling around them.
Reply With Quote Quick reply to this message
 
Old 12-10-2019, 10:17 AM
 
Location: Washington Park, Denver
7,552 posts, read 7,041,646 times
Reputation: 8323
Quote:
Originally Posted by mathjak107 View Post
personal rates of inflation are all over the map

someone who refinanced at these rates likely saved enough to pay for all the increases they got and still save more money and even go to star bucks daily ..

millions of people have their rents capped by rent stabilization as well . 1/2 of all rentals in nyc and the boroughs , representing millions is rent stabilized .

many seniors in cities have programs that cap rents if they qualify .


so trying to compare ones personal cost of living to an index of price changes is nuts
This post is one among many in this post trying to speak sense to the OP who has no interest in hearing it.

Unfortunately, EDS_, mathjak, and ichoro will never be able to get through to conspiracy theorists like heart who have their minds made up without ever taking a basic macroeconomics class. It’s hard to have a conversation with someone who doesn’t understand how the instruments work.
Reply With Quote Quick reply to this message
 
Old 12-11-2019, 11:19 AM
 
2,007 posts, read 493,023 times
Reputation: 3082
Quote:
Originally Posted by SkyDog77 View Post
This post is one among many in this post trying to speak sense to the OP who has no interest in hearing it.

Unfortunately, EDS_, mathjak, and ichoro will never be able to get through to conspiracy theorists like heart who have their minds made up without ever taking a basic macroeconomics class. It’s hard to have a conversation with someone who doesn’t understand how the instruments work.

U.S. consumer inflation is at its highest level since November 2018. And I cited multiple items that I personally buy that have gone up 10+% over the past year. Call it a conspiracy theory if you like.
Reply With Quote Quick reply to this message
 
Old 12-12-2019, 09:02 AM
 
Location: Florida
20,748 posts, read 20,734,260 times
Reputation: 24749
Quote:
Originally Posted by heart84 View Post
U.S. consumer inflation is at its highest level since November 2018. And I cited multiple items that I personally buy that have gone up 10+% over the past year. Call it a conspiracy theory if you like.
]


I buy many of those same products and not seen those prices...coconut milk, for instance,is $2.59,$2.95 and $3,15 in 3 local stores. I suggest you change markets.

(Actually, Aldi's has it on sale this week for $1.79)
Reply With Quote Quick reply to this message
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.

Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.


Reply

Quick Reply
Message:

Over $104,000 in prizes was already given out to active posters on our forum and additional giveaways are planned!

Go Back   City-Data Forum > General Forums > Economics
Similar Threads
Follow City-Data.com founder on our Forum or

All times are GMT -6.

© 2005-2020, Advameg, Inc. · Please obey Forum Rules · Terms of Use and Privacy Policy · Bug Bounty

City-Data.com - Archive 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, 14, 15, 16, 17, 18, 19, 20, 21, 22, 23, 24, 25, 26, 27, 28, 29, 30, 31, 32, 33, 34, 35 - Top