Federal Reserve Goes On A Mortgage Debt Shopping Spree
Federal Reserve Goes On A “Sex & The City” Style Shopping Spree For Mortgage Debt The Federal Reserve pledged on Monday to buy unlimited amounts of Treasuries and mortgage-backed bonds to stabilize the mortgage markets. The Fed hopes it will have the same effect as when it rescued the economy in 2008. The Federal Reserve set a budget last week of $700 billion in bond purchases . However, it blew through half that amount in less than five days. The Fed launched three rounds of bond-buying more after the 2008 financial crisis. The Fed’s aim was to save the housing market and stimulate economic growth. The first phase helped to drive mortgage rates below 5%. The goal of the central bank isn’t to push down mortgage rates. Lower rates are the likely consequence of the Federal Reserve going on a mortgage-backed securities shopping spree. Read more at MFI-Miami