Wednesday, December 10, 2008
From The Big Picture
The Federal Reserve is considering issuing its own debt for the first time, a move that would give the central bank additional flexibility as it tries to stabilize rocky financial markets.
Government debt issuance is largely the province of the Treasury Department, and the Fed already can print as much money as it wants. But as the credit crisis drags on and the economy suffers from recession, Fed officials are looking broadly for new financial tools.
There are going to be screams about this.
The Fed’s balance sheet is a shambles, blasting from 900 billion to more than $2 trillion since August alone.