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On the vast bond trading floors of Morgan Stanley Dean Witter's midtown headquarters, a visitor who somehow had not known what had transpired in New York the previous two days -- including the loss by Morgan Stanley of personnel in its World Trade Center offices -- would have sensed nothing unusual.
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Its vast bond-buying programme took the balance sheet from about $870bn in August 2007 to $4.5tn today.
Its vast bond-buying programme took the balance sheet from about $870bn in August 2007 to almost $4.5tn today.
In agreeing to use proceeds from the Fed's vast mortgage-bond portfolio to buy long-term Treasury securities, the Federal Open Market Committee surprised some economists, who had expected the central bank's policy makers to wait until their next meeting, in September.
If the euro area were able to borrow as a whole, it too should benefit from low borrowing costs, helped by the liquidity advantage of creating what could become a vast government-bond market.But critics of Eurobonds say that creating them within the current framework would actually weaken budgetary discipline, reducing the incentives for weaker states to get their finances in order.
A vast majority of bond funds now require the manager to stick closely to the parameters of a benchmark index, and Eric Jacobson, a bond fund analyst at Morningstar, says managers today are leaning to the short end of their allowable ranges.
This year, a vast majority of bonds issued have been for investment-grade debt, about 78 percent compared with about 12 percent high-yield bonds, said Guy LeBas, the chief fixed-income strategist for Janney Montgomery Scott.
The vast market for bonds backed by credit card debt, auto loans and student loans has effectively shut down.
The new regulations aim to strengthen the vast market for bonds that are backed with mortgages and other loans.
Bowing to pressure, the regulators took into account potential losses on the vast amounts of bonds banks hold from troubled European governments in the latest tests.
Mr. Stein notes with approval that Wall Street firms are using less short-term borrowing to finance their vast inventories of bonds.
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CEO of Professional Science Editing for Scientists @ prosciediting.com