The Fed might be the worst bond trader ever.
They loaded up on trillions in Treasuries and mortgage-backed securities in 2020 when yields were scraping the floor. Classic buy-high behavior.
By June, they were sitting on $878 billion in unrealized losses. And that was before 10-year yields blew past 5% and mortgage rates crossed 7%.
You'd have to actively try to lose this much money. It's almost impressive.
This is what happens when you print money and buy bonds with no exit plan. The exchange rate between common sense and central bank policy? Zero.
They loaded up on trillions in Treasuries and mortgage-backed securities in 2020 when yields were scraping the floor. Classic buy-high behavior.
By June, they were sitting on $878 billion in unrealized losses. And that was before 10-year yields blew past 5% and mortgage rates crossed 7%.
You'd have to actively try to lose this much money. It's almost impressive.
This is what happens when you print money and buy bonds with no exit plan. The exchange rate between common sense and central bank policy? Zero.