Hi Sinbob

Just wondering, how do we know that the Fed is really tapering and not just saying that they're tapering ? After all they're not audited or officially answerable to anyone but their owners. Couldn't they just loan or guarantee some money to ( insert name of your favourite hated bank here ) and have them effectively top up the QE with whatever it takes ?

Couldn't one of their friends or owners convert some excess reserves parked at the Fed into treasuries and then deposit those treasuries at the Fed in lieu of the excess reserves ?

I may ( probably ) have the details wrong but I'm sure the Fed and their owners are smart enough the increase QE substantially if required and still maintain the appearance of tapering. But then I'm such a trusting soul.

W