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THURSDAY, NOVEMBER 26, 2009
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Fed to Spend $1T on Mortgage, Treasury Securities

Latest intervention hopes to lower lending costs

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(Newser) – The Fed plans buy up to $300 billion in long-term Treasury securities in an attempt to make lending more affordable, the Wall Street Journal reports. The massive buy is intended to push down interest rates on consumer loans and corporate bonds, which are linked to yields T-bills. The Fed will also buy $750 billion of mortgage-backed securities—above $500 billion it is currently buying—in order to raise the assets’ prices.

Federal Reserve Chairman Ben Bernanke speaks about reforming the US bank regulatory system in light of the global financial crisis last week.
Federal Reserve Chairman Ben Bernanke speaks about reforming the US bank regulatory system in light of the global financial crisis last week.   (AP Photo)
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Bryanw55
Mar 18, 09 3:12 PM CDT
This massive buy is to devalue the US dollar, so that the middle class that didn't have money in the stock market, but in the bank, will have their pockets picked as well. Nationalize the Fed. That is one area that no private business should control. While in theory, elected officials can be held accoutable by elections, the fed is accountable to no one. Reply
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BackAgain
Mar 18, 09 3:19 PM CDT
Keep printing that money so mine will be worth nothing but fire starter. Thanks guys. Reply
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Snowleopard
Mar 18, 09 3:36 PM CDT
This approach of just buying up bad assets doesn't do anything to address the real problem, that the consumer/working class is falling deeper and deeper into debt. All that buying up this debt is doing is delaying the problem. We're in a cycle where the wealth is getting sucked out of the lower and middle classes. Unless you get money into the hands of mortgage holders, there will be more and more defaults. Reply
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