Fed not considering pulling back on bond-buying in light of COVID-19 vaccine optimism

Fed Chairman Jerome Powell

The Federal Reserve isn’t contemplating pulling back on its bond-buying program even though there is widespread optimism about the medium-term economic outlook given promising news on COVID-19 vaccines, Fed chief Jerome Powell said Wednesday.

During a House Financial Services committee hearing, Rep. Bryan Steil, a Republican of Wisconsin, asked Powell about the balance sheet policy in light of the vaccine development.

“Can you comment on the indicators that you are watching closely as you consider taking steps to begin to restore the Fed’s balance sheet to its pre-pandemic levels?” Steil asked.

The Fed’s balance sheet is $7.2 trillion, more than $3 trillion bigger than at the beginning of the year. The central bank has been buying $120 billion per month of Treasurys and asset-backed mortgages since June.

In response, Powell said the Fed is “going to keep our rates low and keep our tools working until

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How The Fed Paved The Way For The Biggest Real Estate Investment Opportunity Of Our Lifetime

Dave Friedman is Co-Founder and CEO of Knox Financial, the smart and frictionless way to turn a home into an investment property. 

News coming out of the Federal Reserve often goes pretty much unnoticed to everyone except professionals in economics, finance or real estate. As everyday Americans begin to consider how to plan for their financial futures in 2021 and beyond, a couple of recent moves at the Fed are worth a closer look. 

First, the Fed told us it was “not even thinking about thinking about raising rates.” Then, in September the Fed announced a near-zero policy through the end of 2023. The reason for this, it cites, is a goal of lowering unemployment. The Fed’s mission is to support full employment while controlling inflation. With the official U.S. unemployment tally coming in at more than 10 million (and some estimates as high as 30 million), the

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American Consumers Shun Plastic But Borrow More for Homes and Cars, Fed Report Shows

Americans continue to shy away from adding onto their credit cards even as they borrow more to buy houses and cars, according to a new report from the Federal Reserve Bank of New York.

Household debt overall rose by $87 billion, or 0.6%, to $14.35 trillion in the third quarter compared with the second quarter, the New York Fed said. But credit-card balances declined by $10 billion to $810 billion. That followed a $76 billion decline in the second quarter, the steepest drop in data going back to 1999.

That drop reflects both lower levels of spending due to the coronavirus pandemic as well as an effort by consumers to use extra cash to pay down debt, according to the New York Fed.

Many households benefited from a temporary boost of $600 a week to unemployment compensation as well as one-time payments of $1,200 per adult and $500 per child

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