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The Fed just pulled off something remarkable — and they did it with barely a whisper.
After months of insisting they were done with quantitative easing and ready to tighten for real, it turns out the economy is still far too addicted to Fed liquidity. So the money printer fired up late last week.
Not that they would ever call it that. Instead, they’ve rolled out a soft, boring label: reserve management purchases.
It sounds harmless, like a routine housekeeping chore at the Fed. But beneath the branding, the effect is the same — money created out of thin air and pumped into the system.
What the Fed Is Actually Doing
In simple terms, the Fed is buying billions of dollars of government debt. This time, instead of mortgage-backed securities or long-dated bonds, they are snapping up short-term government debt directly.
They kicked things off with $8.2 billion and plan to buy $40 billion by month-end. Some analysts think this could ramp to well over half-a-trillion dollars. Chair Jerome Powell will swear this is not quantitative easing — just a technical move to keep the plumbing smooth — but when the Fed creates new money to buy government debt, the distinction becomes academic.
If it walks like a duck and quacks like a duck, you know what it is.
How Markets Are Responding
The reaction has been immediate. Stocks ripped — we dipped briefly, then ripped right back to the highest S&P 500 (SPY) close of all time before a really bad day Friday.
When the Fed prints money, it has to go somewhere and a big chunk flows straight into equities, pushing prices higher.
Precious metals are behaving the same way. Gold is pressing right below its all-time high and silver has gone almost parabolic, up over 100% year to date. When liquidity floods the system, hard assets do not wait around — they surge.
There is also a more conservative play here…
Treasury bills. These short-term loans to the government are among the safest assets in the world. For investors wanting exposure to the Fed’s liquidity wave without the volatility of stocks or metals, T-bills offer a steadier path.
And here is the key: Do not fight the Fed when it is printing. The opportunity is to ride the assets that rise with the tide of new money — then step aside at an opportune moment because a major correction is likely at some point.
The Fed is back to its old tricks and markets are likely to be the benefactor. The smart move now is positioning yourself to benefit from the liquidity surge while keeping an eye on the exit for when the music slows, assuming of course that Friday’s sell-off is short-lived…
Jeffry Turnmire
Jeffry Turnmire Trading
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I’m just a regular dude in Knoxville, Tennessee: a husband, father, civil engineer, urban farmer, maker and trader.
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*This is for informational and educational purposes only. There is inherent risk in trading, so trade at your own risk.
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We develop tools and strategies to the best of our ability, but no one can guarantee the future. There is always a risk of loss when trading. The profits and performance shown are not typical. From 11/18/25 – 12/12/25 on 32 live trades taken with real money, the win rate is 96.8%, 27.49% average return, with an average hold time of 24 hours.
