Fed's Balance Sheet Shrinks In Latest Week: Chart

After flattening out, it headed higher 8 straight weeks with QE2, until dipping just slightly in the latest week.  When the Fed wants to sell MBS and other securities, who's gonna buy?  Details inisde.

---

(Source - Reuters) - The U.S. Federal Reserve's balance sheet fell in the latest week, following eight consecutive weeks of growth, as agency mortgage-backed securities holdings fell more than Treasury holdings increased, Fed data released on Thursday showed.

The balance sheet -- a broad gauge of Fed lending to the financial system -- declined to $2.403 trillion in the week ended December 29 from $2.410 trillion the prior week.

The balance sheet has been expanding since the U.S. central bank last month began a second bout of quantitative easing, known as QE2. The Fed expects to execute about $600 billion in U.S. government debt purchases over an eight-month period in an effort to stimulate the economy.

The balance sheet had topped the previous record of $2.333 trillion set in May as the Fed was about to end its initial round of bond purchases that involved $300 billion of Treasuries and $1.425 billion in mortgage-related securities.

The second round of quantitative easing follows the Fed's use of proceeds from maturing mortgage securities in its portfolio to buy Treasuries -- a move that started in August. Since that time, it has purchased about a combined $236 billion in Treasuries.

Continue reading at Reuters...

---

Answer this important question Bernanke:

• To whom does the Fed intend to sell its MBS?... 

---

More charts:

• Complete Chart Archive...

---

Related stories...

Alan Grayson - Congratulations America! You Own Bankrupt Red Roof Inns

Fed's Maiden Lane Spins Crap Assets Into Tungsten

CHART SHOCK: The REAL Unemployment Rate Is 22%

CHART SHOCK: Fed's balance sheet grows to RECORD size

Not So Well Known - Tracking The Fed's OTHER Debt Program

---

Comments

[DailyBail]

http://dailybail.com/home/chart-shock-feds-balance-sheet-grows-to-record-size.html

last week's data...

[DailyBail]

Warren Buffett’s Berkshire Hathaway Inc. may report that the value of its equity portfolio rose by $6.3 billion in the last three months of 2010 as holdings in Wells Fargo & Co. and Coca-Cola Co. rallied, Barclays Plc said.

http://www.bloomberg.com/news/2011-01-04/buffett-may-post-a-6-billion-gain-after-wells-fargo-rally-barclays-says.html

[DailyBail]

Amherst finds mortgage market underestimates looming defaults

http://www.housingwire.com/2011/01/03/amherst-finds-mortgage-market-underestimates-looming-defaults

[DailyBail]

Don’t Bet on Lower Housing Prices in 2011

http://www.thefiscaltimes.com/Blogs/2011/01/03/Dont-Bet-on-Lower-Housing-Prices-in-2011.aspx

he's wrong...

[DailyBail]

WASHINGTON -- Congress and federal agencies are expected to spend as much as $60 million in fiscal 2009 on a little-known taxpayer-funded perk: repaying government employees' college loans.

http://online.wsj.com/article/SB124578152192043001.html

[DailyBail]

Judge Says Emanuel Can Run In Chicago Mayoral Election

http://online.wsj.com/article/SB10001424052748704723104576061883042209972.html?mod=WSJ_newsreel_politics

[S. Gompers]

How is the taxpayer balance sheet doing?

[DailyBail]

damn good question...i'd say we support corrupt crony capitalism to the tune of hundreds of billions per year...and that the balance sheet looks rather, um, well imbalanced...

[S. Gompers]

If you remember, years ago the Congressional Bank closed because to many of our illustrious ones were bouncing way to many of their personal checks.

Lesson that should have been learned;

Don't elect people to control the nations spending that can't balance their own checkbooks.

Lesson that we really learned;

We gotta keep voting the herd saviors back into power, toe the line, toe the line, ignore all you see around you.

The cave wall show starts in 5 minutes...

[DailyBail]

i remember the bounced check scandal...and the congressional post office and rostenkowski...