Thought it would be instructive to take a snapshot of some highlights of the federal reserves balance sheet before the great unwind. Than added the massive deficits the Trump administration is going to run. This is more than just bad timing.
Notice they have no treasury bills. There U.S treasury securities are just notes and bond. There is going to be massive pressure on the long end of the yield curve.
Some are saying this is just another head fake by the fed. If you pay close attention to all the FOMC ( see here, here, and here) you can see they started what I will call “Phase 1”. Additionally, in their recent speeches and talks, they are getting more vocal about what they are going to do. I believe this time they will actually attempt to execute their plan. The odds of this going off smoothly and without any hiccups are close to zero.
