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Unusual Whales Pod Ep 16: Macro Outlook for 2023, the Federal Reserve in 2023, and the January 6.5% CPI Print

Unusual Whales

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The Fed's Balance Sheet Is Underpriced

The Fed holds several trillion dollars in treasures in agency and yes rates have gone higher so their unrealized losses have been you know several hundred billion dollars. Pedro: By taking duration risk out of the market in a sense they make their monetary policy less effective because when they raise rates it doesn't decrease wealth as much since a lot of the losses are a lot of securities I held on their balance sheet but it's another subsidy in a sense true to the private sector.

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