by Pam Martens and Russ Martens
Wall Street on Parade
The Vice Chairman for Supervision at the Federal Reserve, Randal Quarles, dropped a bombshell during the House Financial Services Committee hearing held yesterday, but because mainstream media ignores these hearings unless they have something to do with Donald Trump, this critical news went unreported.
Congressman Bill Foster of Illinois addressed Quarles with this statement:
“The Treasury market is the most liquid fixed income market in the world. It serves as a critical benchmark for other bond markets that are essential. It allows the U.S. Dollar to operate as the world’s dominant reserve currency. That is why it is crucial that these financial pipes continue to function well, especially as we continue to fight COVID-19 and we work to provide fiscal relief to millions of struggling families and small businesses.
“When the Fed has to step in to support the market for Treasury bonds, I view it as the financial equivalent of our military going to DEFCON 2….”
Foster was referring to the dysfunction in the Treasury market in March as the pandemic escalated in the U.S. and millions of investors around the world moved out of both stocks and Treasuries and into cash.