By their estimates if the Fed does this the 10 year yield could go to 6-8%. RIP housing if this were to play out.
Borrowing costs would go through the roof.
Linkt.co/Sagaj8UGhD pic.twitter.com/F8Y5a498TO
— QE Infinity (@StealthQE4) May 19, 2024
Fed’s $7.3 trillion balance sheet is worrying the world’s largest asset manager. Here’s why.
Changes to how the Federal Reserve manages one of world’s most crucial piles of assets pose “underappreciated” risks to financial markets, BlackRock warned in a Friday client note.
The Fed in early May said it plans to switch up how quickly it will look to shrink its $7.3 trillion balance sheet beginning June 1, a move that was “barely a side note” in financial markets, according to Tom Becker, portfolio manager at BlackRock’s Global Tactical Asset Allocation team.