Is the FED almost out of assests?

[jacobdcoates]

I forget where I read it a couple of weeks ago, but after all the alphabet soup lending facilities the FED had ~400biliion is assets left. Since then, they have pledged 200 billion to fannie and freddie, another 75 biliion to the banking system, and 100 billion to AIG, grand total would be 375 billion by my simple counting. Since the FED can not run out of money to lend( because it can print), but wouldn't the Treasury have to issue more bonds in order for it to do this, so they had more assets to lend? In order for the Treasury to do that, Congress would have to massively increase the debt limit, but if they don't then the Treasury is broke and defaults on the outstanding debt? All this would lead one to believe that the FED/Treasury are about to Print a MASSIVE amount of money in the VERY near future. Forgive me if I've made any wrong assumptions, but it is very had to keep magic math straight.

[Pascal]

Re: Is the FED almost out of assests?

Jacob, I think you're about right with regard to the Fed's balance sheet. Only problem is that this Fed has shown an ability and willingness to monetize just about anything. They do not need treasuries as collateral any more. Anything will do these days, even a dead dog.

The deflationists' pushing on a string argument is a quaint notion in the face of (to use Heli Ben's phrase) "a determined central bank". Heaven help us all.