From: " rel="nofollow" target="_new">www.zerohedge.com/article/guest-post-fed-covert-money-printing-alert

This note contains an update on where Fed printing stands, how much is left, what the pace of purchases is, and when the program will stop. It also updates the Fed's balance sheet, and its inflationary impact. This update houses some very important developments, due to actions at the US Treasury in coordination with the Fed.

Needless to say, Fed monetization programs have been a huge source of liquidity for the marketplace. It remains to be seen what will happen when this program is over, but it seems fair to say that liquidity will dramatically contract.

Conclusions

There are a few main conclusions from this analysis:

1. Treasury program: The $300B Treasury program is now basically over (source).
2. Agency/MBS program: The $1.425 Agency/MBS program is about $1.18T finished, while purchases continue at a slightly slackened pace of approximately $90B per month. At this rate, the program will be effectively over and done with by the middle of February 2010. This has clear liquidity implications for the marketplace come that time.
3. SFP reduction and $268B of net printing the past 2 months: The "SFP", a program through which the US Treasury issued debt for the Fed to spend to blunt the inflationary impact of Fed balance sheet expansion, has led to tremendous money printing the past 2 months. Since 9/23/09, we've seen the SFP reduced by $185B and Fed Assets *increased* by $83B. In effect, then, the past 2 months have witnessed $268B worth of net printing of money by the Federal Reserve, without so much as a peep from the MSM (source).
4. Real economy printing flat: It is true that the amount of money that has worked its way into the Real Economy (net of excess reserves and SFP) has remained flat (source). However this is due to the fact that banks now have $1,046B of excess reserves deposited back at the Fed, on which they are earning a risk free return of 25 bps. More free money for the banks guys!

In summary, the past 2 months have witnessed a huge amount of money printing, and a dramatic increase in the risk free profits the banks are getting. Is anybody watching this? Does nobody care? With a sleight of hand, the Fed has effectively cheapened the value of our money considerably. The equivalent of a hat trick has allowed the Fed to monetize almost $300B of Treasury debt in the past 2 months. 

As noted in "Our Deficits - A Clear and Present Danger" (HBA 11/18/09), the US has a very considerable debt issuance problem in 2010 and thereafter. Trying to covertly print money at the Fed is apparently the solution our Administration has come up with. 

Foreign central banks, are you watching this? Does this make anyone a little nervous? We have a hole at the bottom of our "ship". The hole is still there. What's next?