In this episode, Andy Constan joins the show to discuss Quantitative Tightening 2.0, why the Fed wants to change its SOMA portfolio, and the connection between QT, the debt ceiling, and TGA. We also delve into the deficit, DOGE success being anti-growth, and much more. Enjoy!
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Timestamps:
(00:00) Introduction
(01:08) Understanding Quantitative Tightening (QT) 2.0
(10:01) Skale Ad
(10:22) Why the Fed Wants to Adjust its SOMA Portfolio
(17:50) Potential Market Impacts and Future Strategies
(25:17) Debate on QT Pause and Debt Ceiling Dynamics
(34:51) Skale Ad
(35:21) Debate on QT Pause and Debt Ceiling Dynamics (Con't)
(38:35) Monetary Plumbing, Debt Ceiling Concerns, & Demand for Treasuries
(44:03) Impact of Budget Deficit on Issuance & Interest Rates
(52:28) Economic Projections and Policy Impacts
(01:00:55) Risk Assets and Market Sentiment
(01:05:44) Is There A Bond Trade?
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Disclaimer: Nothing discussed on Forward Guidance should be considered as investment advice. Please always do your own research & speak to a financial advisor before thinking about, thinking about putting your money into these crazy markets.
The Fed's Balance Sheet Plans Are Kryptonite For Risk Assets | Andy Constan | Forward Guidance podcast - Listen or read transcript on Metacast
