/biz/ - Business & Finance

>>21638357
QE is essentially a soft form or an implicit form of YCC although FED does not want to admit. When FED is buying treasuries it is overriding the free market pricing mechanism and essentially pushing down yields. The only way this differs from formal yield curve control is that FED has not publicly capped the yields but instead they just buy some "random" amount of treasuries to keep the yields lower than they should be in the form of QE. It is possible that the FED never admits to doing YCC but if they at the same time buy tons of treasuries they are de facto doing it by artificially surpressing the yield curve. This year by far the largest part of treasuries have been bought by the FED and not private investors.