Fed Considers New 'Sterilized' Bond Buying Plan To Avoid Rampant Inflation
Tweet Send to a Friend
Stocks are pushing to the highs of the day on word the Federal Reserve is considering a new "sterilized' bond buying program for further easing, if needed. This according to the Wall Street Journal's Fed insider Jon Hilsenrath.
The new program will be designed to subdue worries about future inflation. Under the approach, the Fed would print new money to buy long-term mortgage or Treasury bonds but effectively tie up that money by borrowing it back for short periods at low rates.
The Fed will be meeting next week, altogether they will unlikely launch a new bond buying program. The Fed is keenly aware that more money printing could push commodities prices higher, including oil, in addition to stock prices, on the perception inflation is headed higher. The new approach could help calm these inflation fears.
Link to WSJ article.
Join StreetInsider.com FREE and get immediately alerted when news breaks on your stocks and other market items - JOIN NOW
*NEW - Download StreetInsider's FREE iPhone and iPad App - Click Here
The new program will be designed to subdue worries about future inflation. Under the approach, the Fed would print new money to buy long-term mortgage or Treasury bonds but effectively tie up that money by borrowing it back for short periods at low rates.
The Fed will be meeting next week, altogether they will unlikely launch a new bond buying program. The Fed is keenly aware that more money printing could push commodities prices higher, including oil, in addition to stock prices, on the perception inflation is headed higher. The new approach could help calm these inflation fears.
Link to WSJ article.
Join StreetInsider.com FREE and get immediately alerted when news breaks on your stocks and other market items - JOIN NOW
*NEW - Download StreetInsider's FREE iPhone and iPad App - Click Here
You May Also Be Interested In
- Yahoo! (YHOO) Board Said to Approve $1.1B Tumblr Deal
- If SolarCity (SCTY) is a 'Bubble', Then Real Goods Solar (RSOL) is a 'Black Swan'
- 50-Day SMA Crossers 05/20: (ELN) (ACI) (AAPL) Above; (MRK) (TLAB) (CLSN) Below
Create E-mail Alert Related Categories
Fed, Hot List, Trader Talk
Login with Facebook
Sign up for StreetInsider Free!
Receive full access to all new and archived articles, unlimited portfolio tracking, e-mail alerts, custom newswires and RSS feeds - and more!
