As Everything Bubble Implodes, Frazzled Fed Rolls Out Fastest Mega-Money Printer Ever, up to $4.5 Trillion in Four Weeks

As Everything Bubble Implodes, Frazzled Fed Rolls Out Fastest Mega-Money Printer Ever, up to $4.5 Trillion in Four Weeks, by Wolf Richter.

Repos soared from $143 billion two weeks ago to $242 billion, nearly back where they’d been on January 1 ($256 billion). …

Thursday early afternoon, the Fed announced in a surprise shock-and-awe move that it will use the repo market in a big way to try to prop up and inflate whatever needs propping up and inflating. It will offer a series of $500-billion term repos at least through April 13, amounting to $4.0 trillion in new money over the four-week period. …

On Friday, the Fed will offer $1 trillion in repos: $500 billion in three-month repos and $500 billion in one-month repos. That’s a heck of a lot of bucks to print in just one day. But no problem for the new mega-money printer. If anyone wants this much, it can print it.

Next week (the week of March 16), the Fed will offer another $1 trillion: next Monday, $500 billion in one-month repos; and next Friday, $500 billion in three-month repos.

This will continue in each week, the same procedure of $1 trillion a week plus all the other repos, through Monday, April 13. …

It would more than double the already re-ballooned [Fed’s] balance sheet (currently $4.3 trillion). It could push the balance sheet to nearly $9 trillion by April 13.

This is apparently the price of trying to maintain the insane Everything Bubble that the Fed has created since 2009.

And the price of gold? Tanking, because it is set on a purely paper exchange, the NY COMEX. Do not image for one moment that the price of gold is determined by people trading physical gold. Instead it is set in New York at a futures exchange, where paper is traded. Theoretically there is a link between the COMEX and physical gold that allows arbitrage, but due to various shenanigans the link is so weak as to be scarcely existent. So the “gold” trading is heavily manipulated.

If the price of gold hadn’t been pushed down twice by $100 per ounce in the last two weeks, it would be two or three thousand dollars per ounce now. “Everyone” would know the US dollar was in trouble and major inflation was upon us. The issuers of paper currency cannot allow that to happen, so they didn’t.

Gold, the canary in the mine shaft that warns of the build up of deadly but odorless carbon monoxide by keeling over, is not free to swoon.