4min chapter

Forward Guidance cover image

The Fed Won't Get their Soft Landing | Jim Bianco

Forward Guidance

CHAPTER

The Fed's Quantitative Tightening Strategy

The Fed was buying 220 billion dollars worth of bonds a month and they're tapering that to a hundred billion dollars of bonds amonth Wait a minute. I thought it was 120 to zero But there's another hundred billion in there that is every the Fed has nearly a nine trillion dollar portfolio of Securities. They then buy a hundred billion on top of that just to offset the maturing securities And then they were buying another hundred and twenty billion to expand the balance sheet so on March 1st when they go to zero on the Expansion they're still buying a hundred and 20 billion dollars of security each month. Eventually under quantitative tightening take that down to zero and That would be the reduction of the balance

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