http://polwaves.planetwaves.net/2008/05/27/it-was-always-the-oil/ News via Planet Waves Thu, 08 Jan 2009 00:32:42 +0000 http://wordpress.org/?v=2.6.2 http://polwaves.planetwaves.net/2008/05/27/it-was-always-the-oil/#comment-159921 import export business Mon, 28 Jul 2008 19:05:45 +0000 http://polwaves.planetwaves.net/2008/05/27/it-was-always-the-oil/#comment-159921 Perhaps most importantly, however, is the massive liquidity injections from the rest of the world, or what Brad Setser calls “ the quiet bailout .” In the first half of this, global central banks accumulated $283.5 billion of Treasuries and Agencies, something around $1,000 per capita. This is real money; I outlined the likely implications in January. Foreign CBs are happily financing the first US stimulus package; will they be happy to finance a second? Do they have a choice? Their accumulation of Agency debt is also keeping the US mortgage market afloat. Perhaps most importantly, however, is the massive liquidity injections from the rest of the world, or what Brad Setser calls “ the quiet bailout .” In the first half of this, global central banks accumulated $283.5 billion of Treasuries and Agencies, something around $1,000 per capita. This is real money; I outlined the likely implications in January. Foreign CBs are happily financing the first US stimulus package; will they be happy to finance a second? Do they have a choice? Their accumulation of Agency debt is also keeping the US mortgage market afloat.

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