Monday, April 11, 2011

4/11 2:15

ABC decline appears done.

Minutes of the Fed March meeting end any hope of prematurely terminating QE2.  So we are left with Fed re-balancing (getting rid of risk assets while buying treasuries).  The Fed balance sheet is currently $2.679Trillion.  As QE2 nears an end I would expect buying of treasuries to slow and sales of risk assets to remain brisk.

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