/biz/ - Business & Finance

>>22751410
>But they can't do anything with them besides lend against them

Sorry but this is another sticking point in Steve and Jeffs' theories.

Banks don't need any reserves to lend against. As of March 2020 the reserve requirement in the US is 0%. In Europe and most of the West, it has been 0% for years.

Banks can literally lend against NOTHING, but are simply not doing it. Bank reserves at this point are used primarily for intra-bank transaction liquidity. AND they earn a small% interest at the Fed.

>>22509337
>interest rates rise soon
That will not change your yield %, but rather the premium on your bond. So if you buy them in a trading account, you can sell them for more once the next round of QE starts.

This is what banks are doing right now. They are stealth accumulating trillions of $ in bonds, while simultaneously tightening lending standards in order to deflate the economy more and force the Fed to do more QE which will raise bond prices.

Buying bonds right now is essentially following smart money. Just get ready to sell within a few months.

>>22327987
PMs at that price will require hyperinflation, probably the least likely scenario, at this moment*.

*A change in monetary policy, such as allowing the Fed to directly monetize debts, would make that scenario the MOST likely.