Update On The Fed's Pivot To QT----Balance Sheet Has Already Shrunk By $171 Billion

Here’s what the Fed’s QE unwind – or the balance sheet normalization, as it calls it – is all about: it reverses over an unknown span of years a large part of what QE had done over the span of five-and-a-half years. During QE, whose stated purpose was the “wealth effect,” the Fed amassed $3.4 trillion in Treasury securities and mortgage-backed securities (MBS). Just as the Fed spent a year tapering QE to zero, it is now spending a year ramping up the QE unwind.

 

https://wolfstreet.com/2018/07/06/update-on-the-feds-qe-unwind/

 

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