Australia's Central Bank Says It Is Bust

[JustAGuy1]

The central bank of Australia on Wednesday made the astonishing admission that it is, basically, bust. Its entire equity has been wiped out by pandemic-related bond buying.


Of course, the Reserve Bank of Australia is a central bank, and can print money. So it can work its way out of a situation that would bankrupt a conventional bank or company.


Still, as the U.S. Federal Reserve meets today on interest rates, it's an interesting insight into the challenges other central bankers face as they attempt to reconcile Covid stimulus with post-Covid inflation and economic emergence.


The RBA began its bond-purchase program in November 2020 as a second stimulus package in response to the pandemic. The first round of measures saw it slash rates to record lows, and set up a term funding facility offering cheap three-year funding to banks. For the bond buying, the central bank bought Australian government bonds and semi-government securities in the secondary market to lower interest rates on bonds maturing between five and 10 years out.


The program was extended, and extended, and extended yet again. Ultimately, the RBA bought A$281 billion (US$188 billion) in national, state and territory government bonds.


Now the bill has come due.

Australia's Central Bank Says It Is Bust

After the Australian fiscal year ended in June, the Reserve Bank of Australia marked its bond holdings to market - wiping out all its reserves.

realmoney.thestreet.com

Won't be the last one to go down. The storm is coming. It has to be Rump's fault, right?

 

[Pete7469]

What I don't get is why so many countries around the world bought into the Dempanic. It was clearly HORSESHIT. It was a cold. Perhaps a nasty one, but not that much nastier than swine flu, bird flu, SARs, or any of the other sicknesses the media hyped over the last 20 years.

 

[Yarddog]

The central bank of Australia on Wednesday made the astonishing admission that it is, basically, bust. Its entire equity has been wiped out by pandemic-related bond buying.


Of course, the Reserve Bank of Australia is a central bank, and can print money. So it can work its way out of a situation that would bankrupt a conventional bank or company.


Still, as the U.S. Federal Reserve meets today on interest rates, it's an interesting insight into the challenges other central bankers face as they attempt to reconcile Covid stimulus with post-Covid inflation and economic emergence.


The RBA began its bond-purchase program in November 2020 as a second stimulus package in response to the pandemic. The first round of measures saw it slash rates to record lows, and set up a term funding facility offering cheap three-year funding to banks. For the bond buying, the central bank bought Australian government bonds and semi-government securities in the secondary market to lower interest rates on bonds maturing between five and 10 years out.


The program was extended, and extended, and extended yet again. Ultimately, the RBA bought A$281 billion (US$188 billion) in national, state and territory government bonds.


Now the bill has come due.

Australia's Central Bank Says It Is Bust

After the Australian fiscal year ended in June, the Reserve Bank of Australia marked its bond holdings to market - wiping out all its reserves.

realmoney.thestreet.com

Won't be the last one to go down. The storm is coming. It has to be Rump's fault, right?

Ruuump Roe!!! sounds like somebody in trouble!
No one listened to reason early on, this was never hard to predict.

 

[Resnic]

I'm sure uncle Biden will just give them a few trillion.

 

[Augustine_]

The central bank of Australia on Wednesday made the astonishing admission that it is, basically, bust. Its entire equity has been wiped out by pandemic-related bond buying.


Of course, the Reserve Bank of Australia is a central bank, and can print money. So it can work its way out of a situation that would bankrupt a conventional bank or company.


Still, as the U.S. Federal Reserve meets today on interest rates, it's an interesting insight into the challenges other central bankers face as they attempt to reconcile Covid stimulus with post-Covid inflation and economic emergence.


The RBA began its bond-purchase program in November 2020 as a second stimulus package in response to the pandemic. The first round of measures saw it slash rates to record lows, and set up a term funding facility offering cheap three-year funding to banks. For the bond buying, the central bank bought Australian government bonds and semi-government securities in the secondary market to lower interest rates on bonds maturing between five and 10 years out.


The program was extended, and extended, and extended yet again. Ultimately, the RBA bought A$281 billion (US$188 billion) in national, state and territory government bonds.


Now the bill has come due.

Australia's Central Bank Says It Is Bust

After the Australian fiscal year ended in June, the Reserve Bank of Australia marked its bond holdings to market - wiping out all its reserves.

realmoney.thestreet.com

Won't be the last one to go down. The storm is coming. It has to be Rump's fault, right?

The beginnings of potentially interesting information ruined by insecure persecution fetish. Conservative entertainment at its finest.

 

[jknowgood]

The beginnings of potentially interesting information ruined by insecure persecution fetish. Conservative entertainment at its finest.

No, Biden was handed a recovering economy and totally screwed it up. The only fetish with you loons is supporting a pedophile that sexually assaulted his own daughter. The groomer party, you're sick.

 

[Augustine_]

No, Biden was handed a recovering economy and totally screwed it up. The only fetish with you loons is supporting a pedophile that sexually assaulted his own daughter. The groomer party, you're sick.

Biden took over after a lunatic handled a crisis like a lunatic. The rest of your post is mental illness and I choose to respect your struggle by ignoring it.

 

[jknowgood]

Biden took over after a lunatic handled a crisis like a lunatic. The rest of your post is mental illness and I choose to respect your struggle by ignoring it.

Biden screwed the pooch and his daughter. Not my fault you sick people overlook it. Biden is the worst president in our history. He has even made Carter look good.

 

[TheGreatSatan]

SHOCKER!!!

I'm like totally surprised. Didn't see that coming. It's like a slow build up to something very major.