FED $7 Trillion Stimulus: Welfare for the Wealthy Elite

After crossing back above the $4 trillion mark back in October 2019 in the aftermath of the JPMorgan repo market bailout, also known as “No QE”, the Fed’s balance sheet is nearly double that amount a little over half a year later, with the Fed reporting in its latest H.4.1 report that as of May 20, 2020, its total assets rose above $7 trillion for the first time ever, an increase of $103 billion in the past week to $7,038 billion. Putting the increase in context, the Fed’s balance sheet hit $6 trillion on April 2.

The increase was mostly the result of a $79BN increase in settled MBS purchases as well as $32BN in Treasury purchases, while there was no change in the Fed’s holdings in its commercial paper facility.

The Fed’s balance sheet is broadly expected to hit $12 trillion in the next 12 months of continuing Fed stimulus injections into the markets to prevent a full-blown economic collapse.