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Deficit Spending Will Send S&P 500 To 6,000 And Beyond | George Robertson & Mel Mattison on the True Risk-Free Rate and The Fed's Control of The Treasury Market

Forward Guidance

CHAPTER

The Federal Reserve's Influence on Treasury Markets

This chapter examines the complexities of mortgage-backed securities and their interconnectedness with treasury rates, particularly focusing on prepayment options and the historical roles of institutions like Fannie Mae. It delves into the Federal Reserve's strategic maneuvers in the Treasury market, including quantitative easing and the manipulation of federal funds rates, underscoring its control over the broader financial landscape. Additionally, the discussion explores the implications of these financial mechanisms on consumer loans, credit spreads, and the evolving risk perceptions in the market.

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