Smart Money is dumping their shares recognizing the party is over for the U.S. Dollar and the temporary propping up of the U.S. Economy.
The short-term trend is up but thats just so they can sell out, longterm trend is down.
Research how many realestate moguls have started liquidating all of their empires. That will lead you to the truth, do your h.w. and then recognize all the responses there are on this thread and ID them for the 2015 economic scenario.
First off , let me start with I dont want to argue with you. People on this board have been very friendly and helpful to me in my options education amongst other topics.
Sorry for the improper use of pronouns but when the FED buys bonds ( all kinds) during QE they are CREATING money to do it. They are INCREASING the money supply. This is not my opinion; Please look this up.
Better put, they are using electronic money that did not exist before the purchase. Thats why they started with "Sterilized QE" this way they can buy long bonds by borrowing against the short term bonds ( repo) thereby not to increase the money supply.
Pull a dollar bill out of your pocket. That is a share in USA inc. Remember it is not backed by gold anymore. Come on, you are a stock guy. ( remember, I am a bond broker 30yrs) You know what dilution does to the value of a stock.
About your 3rd thing:
The fed does not buy the bonds directly from "America"- that would be silly; they buy the bonds from banks and other private sector institutions. So they are flooding banks and institutions with capital that can be used to hire, invest in expansion or lend if its a bank, thereby stimulating the economy.
And again keeping inflation going so we do not fall into the deflationary spiral.
Yes your money will be safe in country where home prices are dipping, jobs are lost and deep global world recession is knocking. Being upset at me will not change a thing.
Let me help you break it down.
Input US Income - Yearly Tax Revenues - $2B (used to be $3B before the "great recession")
Output spending - $7B or is it more? ITs MUCH MORE, but I will use numbers my fine NEWTONIAN friends that wil not ajar you.
A 15yr old can tell "you can't spend 3 times what you make in a year in salary and expect not to go bankrupt." Hello PIGS. You expect AGNC to weather this storm.
AGNC expects to be insulatated from it. This REIT didn't initiate reduction of dividend already because they don't see the same writing on the wall your all crying about not seeing.
They are under DISTRIBUTION currently, maybe if you used Amibroker or QT you can see it more clearly.
Did you think the Greek Elite would ever have to face a time when they would be asked to bail out their country as so matter of fact like it is now being presented.
AGNC with it leverage is going to be underwater soon, no matter how you slice it.
Is that how you save face with the truth by worrying about spell check run on sentences. I often confuse the 19yr old with the 23yr old, but I am sure you men of such high caliber have other things to worry about.
We are all in trouble.
Do some HW and see what the grap look like currently.
This is what is in store for this country and your right the REIT niche will be untouched by it ! Eureka Watson!
I can find no reference to a 23-year version of that scotch even when I spell it right. It was bottled at 19 years 4 years ago, though. Rookie mistake, adding them up.
And your opinion of it is apparently your own. It gets good marks, but not extremely good marks. By no means the sort that would make me seek it out as a chance to taste the "finest".
I'll leave it up to you to figure out the origin of your cigar. If your history is any guide, it's not actually from Cuba.
Two things about that:
1. I'm not the "you" there. The Fed is. And, contrary to public misperception, the Fed is not a part of the US government, though it's rather more tightly regulated by it than other businesses are (its board is approved by the Congress, for instance; and its chairman is summoned periodically to report what he and the rest of the moneychanger class are up to). So that's not the government printing money any more than if I were the "you" there.
2. The Fed doesn't print the money. It uses deposits.
And a third thing:
3. When the Fed makes a profit on an investment, it has to give that profit to the government (part of the regulation mentioned already). So when America borrows money by selling bonds to the Fed it is effectively an interest-free loan, i.e. a zero-coupon bond. Same as what Germany is doing. Only in the German case, anyone can buy zero-coupon bonds. In the Fed case, only the Fed can.
and a fourth, just to fill the cart:
4. The Fed isn't buying just government bonds, it's also buying MBSs, as we all know, which also isn't creating money, just more money-multiplicatin creating more accounts receivable and keeping money from getting stuck in peoples' mattresses and causing deflation.