Fed's Secret Taper Plan: Will Stocks Crash?

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In this video, I discuss the most recent FOMC statement, and its implication for the Fed's taper.

It appears that the Fed is determined to reduce purchases of long-term government debt by $10 billion every month, and the US Treasury is secretly cooperating by issuing less debt at the far end of the yield curve

The US government still needs to borrow massive amounts of money, which we would expect it to do at the front end of the curve (T-Bills). The Fed can then use its Money Market Mutual Fund Liquidity Facility (MMLF) to prop up the front end of the curve.

In this way, the Fed can have its cake and eat it too. Expect stocks, housing prices, and Bitcoin to continue to appreciate sharply, since it is likely that the Fed will need to keep the money printers going for the rest of this decade.

Not investment advice! Consult a financial advisor.

Fed begins taper:
https://www.cnbc.com/2021/11/03/fed-decision-taper-timetable-as-it-starts-pulling-back-on-pandemic-era-economic-aid-.html

Latest FOMC statement:
https://www.federalreserve.gov/newsevents/pressreleases/monetary20211103a.htm

Daily Treasury yield curve rates:
https://www.treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=yield

The Fed is the elephant in the room:
https://www.bloomberg.com/news/articles/2021-11-02/stock-market-jerome-powell-federal-reserve-dominate-treasury-bond-trades

Money printer go brrr:
https://www.youtube.com/watch?v=O1hCLBTD5RM&ab_channel=TimvanHelsdingen

US debt clock:
https://www.usdebtclock.org/

Watch the Fed's balance sheet grow:
https://fred.stlouisfed.org/series/WALCL

US Treasury reduces long-term bond sales:
https://www.bloomberg.com/news/articles/2021-11-03/treasury-unveils-first-cut-in-long-term-debt-sales-since-2016

Money Market Mutual Fund Liquidity Facility (MMLF):
https://www.federalreserve.gov/monetarypolicy/mmlf.htm

What is a money market fun..