FED JUST BOUGHT $20B WORTH OF 3-YEAR BONDS. DOES THIS MEAN QE AND MONEY PRINTING HAS STARTED? 🧵

Let me explain: Fed is reinvesting, not printing. 🧠👇

📌 What is SOMA?

SOMA = System Open Market Account. It’s the Fed’s portfolio of Treasury and agency securities. Managed by the NY Fed to implement monetary policy.

🛠 Why Did SOMA Buy in This Auction?

This is reinvestment, not QE. When bonds mature, SOMA reinvests the cash into new Treasury securities to maintain balance.

⚠️ Important:

SOMA buys are pre-scheduled, non-competitive, and don’t inject new money like QE. It’s just maintenance.

📊 Total Auction:

$168.7B tendered

$78.5B accepted

$20.47B by SOMA (Fed)

🔍 Bottom Line:

SOMA buys = rolling over an FD, not spending new cash.

#Fed