Can the Fed pay the interest on US debts via Repo trades?

Can the Fed effectively pay the interest on US debts via repo trades or other instruments?

Comments (6)

Oct 6, 2013

yes

I'm not concerned with the very poor
-Mitt Romney

Oct 6, 2013
Mitt Romney:

yes

In that case why do we have to worry about the debt ceiling then?

Oct 6, 2013
Kent:

The fed is a fraud - in reality a private bank that perpetuates its own guaranteed profits that are approximately $300 million a day. Anyone disagree?

mebbe take your case up w/ the OWS people then lmk how it goes, kk?

speed boost blaze

Oct 7, 2013
Kent:

The fed is a fraud - in reality a private bank that perpetuates its own guaranteed profits that are approximately $300 million a day. Anyone disagree?

Oct 6, 2013

In the event of US debt default, the Fed can save the financial markets by its market-making power in the US debt market. Federal Reserve can purchase in the open market as much US debt as there are sellers at the fair prices that reflect the principal and interest payments. This would be enough to stabilize the financial markets.