Comment by lxgr
8 months ago
Your model is missing the Fed, which can buy an almost infinite number of bonds to bring the effective interest rate down to whatever it wants.
8 months ago
Your model is missing the Fed, which can buy an almost infinite number of bonds to bring the effective interest rate down to whatever it wants.
You mean, by printing money. Well, if they would do that, the USD would sink even more and thus also the US bonds.