Sunday, May 31, 2009

Federal Reserve Balance Sheet Update: Week Of May 27

By initiating another weekly update column, Zero Hedge will start tracking the massively growing balance sheet of the Federal Reserve, aka the real financial black hole. At this point, when the Federal Reserve (beholden to nobody except Ben Bernanke) has taken effective control over treasury and agency purchases, as well as the financial, insurance, commercial real estate and automotive industries, this is in essence the only relevant balance sheet in the entire United States, and possibly the entire formerly capitalist world. As more and more industries implode and need to be backstopped by the U.S. taxpayers, look for the "assets" side of the balance sheet to balloon well into the $3-4 trillion range.

As of May 27, the components of the Federal Reserve's burgeoning assets included:

Total assets of $2,132 billion consisting of:
  • Securities held outright: $1,108 billion (an increase of $22.6 billion, mostly as a result of $17 billion in new Treasury purchases and a $5 billion increase in Fed Agency Debt )
  • Net borrowings: $555 billion (no change as no updated May 27 H.3 report released yet)
  • Float, liquidity swaps, Maiden Lane and other assets: $469 billion (decrease of $53 billion exclusively due to a reduction in Central Bank Liquidity Swaps: so Europe is confident that everything is good and the Drahma wont have to be recirculated after all...)
Foreign holdings of USTs and Agencies increased by $14.7 billion to $2,724 billion.

Source: Federal Reserve's H.3 and H.4 reports. Sphere: Related Content
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