Reply to Treasuries yields rising as fed cuts

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Reply to "Treasuries yields rising as fed cuts"

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[quote=Anonymous][quote=Anonymous]This is what I kept telling people who said they might look to buy/refinance after the Fed cut rates.  Fed only directly controls short-term rates.

Long-term rates are tied to future growth and inflation expectations- unless the Fed does quantitative easing.  I expect that to be the next step in 2026, trying to drive down long term rates, but the impact will be more inflation as cash is injected into the economy.

https://www.reuters.com/markets/us/fed-could-surprise-market-with-t-bill-buying-binge-2025-12-09/

QE is only really a good idea when inflation is very low or even negative, since it is fundamentally inflationary.  It will be "exciting" to see what these jabronis do to the economy when they try it in an inflationary economy.[/quote]

There it is. From Fed interest rate cut news: "The Fed also announced on Wednesday that it would begin to buy Treasury securities as part of an effort to ensure that there is enough cash in the banking system to ensure that short-term borrowing costs do not inadvertently spike. "[/quote]

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