FYI: For nearly a decade, quantitative easing (QE) has been a significant driver of capital markets. Born in March 2009 as a response to the global financial crisis, QE loomed large in the minds of investors as the Federal Reserve vacuumed up U.S. Treasury bonds and mortgage-backed securities. The Fed’s balance sheet ultimately swelled from about $1.0 trillion to $4.5 trillion. But as the saying goes, all good(?) things must come to an end. Federal Reserve Chair Janet Yellen made it official in September 2017 that the time had come to pay our final respects to QE.
This policy shift leads to a couple of questions:
.What are the ramifications of the end of QE for bond yields?
.What does the end of QE mean for the composition of fixed income benchmarks?
Regards,
Ted
http://www.etf.com/sections/etf-industry-perspective/vanguard-dont-cry-qe?EXCMPGN=EX:PC:FAS:Sustaining
