Quote:
Originally Posted by Scrapper
Nice to see others understand. Just wanted to add a little more as we have a massive global bond bubble. The debt and the derivatives attached can only be described as scary. The Fed will try and pump up the market today so let's watch how they feed even more money to the elite.
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the FED does not have instruments left to pump up the market. The low interest was the only thing they could do to go against the financial crisis.
but imagine, the interest rate than fell from 5% to zero.
how much is the interest rate when you take 5% from 2 or 2,5% ?
regarding the bonds:
China holds around 1,2 trillion in US bonds. they bought most of them in the financial crisis on a low interest rate and that helped the US a lot.
if the US wants more foreign capital (and they will need it because the debt is rising like never before) they need to give more interest. US bonds already lost their triple A rating they had over many many decades. the air becomes thinner every fucking day.