Randall Forsyth * The most important political step taken by the Federal Reserve in recent days was not the cut in the main interest rate, but the resumption of Treasury bond purchases. However, some seasoned observers are firmly convinced that these purchases appear to be part of an undeclared coordination with the Treasury Department to finance the massive US budget deficit and curb long-term bond yields. The official narrative states that the Federal Reserve's monthly purchases of $20 billion in Treasury bonds are nothing more than a routine management of market conditions. As was widely expected, the Federal Open Market Committee cut the target interest rate by a quarter percentage point to a range of 3.50% and 3.75%. But...
