The Federal Reserve disclosed Sunday afternoon the amounts and the company names of the corporate bonds that it started buying for the first time ever in the week ended Friday, June 19. They’re not even rounding errors on the Fed’s balance sheet. The purchases of individual corporate bonds amounted to $428 million (with an M). By comparison, in the week ended April 1, when the Fed was doing a lot of heavy breathing, it bought $362 billion (with a B) of Treasury securities.
In addition, the Fed said in the disclosure that it held a total of $6.8 billion in bond ETFs as of June 19, up from $1.5 billion a month ago.
These bond ETFs and individual corporate bonds combined account for 1/10th of 1% of the Fed’s $7.1 trillion in total assets.
The Fed buys these corporate bonds and bond ETFs in its Special Purpose Vehicle that it calls Secondary Market Corporate Credit Facility (SMCCF). Like the Fed’s other alphabet-soup bailout SPVs, the SMCCF is an LLC entity…CLICK for complete article