Kudlow On The Fed's Balance Sheet (Video)

Federal Reserve Chairman Benjamin B-52 Bernanke testifies tomorrow before the House Financial Services Committee.  Larry Kudlow had a decent primer tonight.  It's short and helpful.  The eventual use of bank reserves on deposit at the Fed to soak up excess liquidity (inflation), and the money supply are discussed (3:12 CNBC Clip).  Watch.

Here's one part of the Fed's balance sheet that's likely not doing so hot.

Comments

[spideydouble]

"So my two points: #1. They have stopped creating new money in the past six months. And #2. The new dough that they did put in last fall during the crisis is not really basically being used. It's on deposit at the Fed and it's called excess reserves. When you watch the hearings tomorrow and you talk about them tomorrow night at the dinner table or the cocktail party, talk about the balance sheet and excess reserves. You'll be a genius and then you'll be running The Kudlow Report."

Truth? Who knows, but it's moments like these that make Larry Kudlow endearing.