Friday, November 30, 2018

Fed may tweak the excess reserves rate again


May portend an acceptance of the Manuchin deal to put rates on hold and instead increase rate of portfolio roll off.... they need to guarantee positive carry between portfolio yield and IOR or they will think they are "out of money!"...







2 comments:

Ralph Musgrave said...

So the Fed will "tweak" the interest it pays to people with piles of $100 bills which they want to store under their mattresses.

I've got a better idea: raise taxes on the poor and give the money to Bill Gates and Warren Buffet....:-)

Matt Franko said...

No Ralph they will "tweak" the IOR rate so that the IOR rate results in the amounts they pay in IOR is < the amount they gain from their portfolio income otherwise they (to them) "lose money!"...