Bloomberg Businessweek

Quantitative Easing By Another Name

The Federal Reserve’s stockpile of Treasuries is poised to double

During the financial crisis, the Federal Reserve began buying Treasury bonds and mortgage-backed securities—a program known as quantitative easing—to help keep interest rates down and boost the economy. With the economy growing steadily, you might think the Fed was done with QE. You’d be half-right.

As soon as next year, the Fed will resume large-scale bond-buying—just U.S. Treasuries this time—in amounts that may ultimately exceed its crisis-era purchases, analysts say. According to an estimate by Wells Fargo & Co., the Fed will add more than $2 trillion to its holdings of Treasury debt.

Of course, the purchases won’t be

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