is the FED going to call in all the loans via US banks

[sishya]

I have a theory but do not have any data to show how much have US Banks given US dollars to foreign Govts and foreign Instituitions.

- FED Reserve buys US mortgages and pays money to US Banks
- FED loans currency swaps to foreign govts.
- FED loans money to US Banks whcih buy foreign bonds and also invest in foreign markets and comapanies

If any one have metrics for these please post here.

Now if this is true, if and when liquidity drain starts, is FED going to call in the loans and also give back the MBS and agency debts back to US banks ? Has the time come or is there some more time ? There is also a possibility that FED would never call in the loans

[aaron]

Re: is the FED going to call in all the loans via US banks

What is to say they have not already started "draining"?

[jtabeb]

Re: is the FED going to call in all the loans via US banks

You need to be cafeful in your definitions here.

They are "draining" wages and benefits, and "pumping" up financial assets which is spilling over into tangible goods (much as they don't like this, they have to or we do get deflation, remember what EJ said, "It's a policy choice" not an accident).

This isn't binary logic, it's some this here, a lot more of the opposite there. The problem is they are pumping so hard on financial assets that the spill-over effets are getting so obvious that even the Sheeple are paying attention to the inflation now.

Argentina is a great case to look at. Past is prologue, as they say.