Quantitative Easing: Every Round in the Fed's Own Data

Michael Whitman · Trading since 2017, full-time since 2020 · Published 2026-09-27

Quantitative easing is what a central bank does when cutting its short-term interest rate is no longer possible because the rate is already close to zero. It buys longer-dated bonds in very large amounts, aiming to lower longer-term borrowing costs directly. By this page’s count, the Federal Reserve has run four buying rounds since 2008.

This page explains the mechanism, walks through one round’s arithmetic, and then measures every round from the Fed’s own weekly balance sheet, including the runoffs that reversed part of them.

How it works

The purchase. The Fed buys a Treasury bond or a mortgage-backed security from a dealer. It pays by crediting reserves to the account the seller’s bank holds at the Fed. Nothing is printed: the new money is a bank reserve, an entry on the Fed’s books, and the bond moves onto the Fed’s balance sheet.

The intended effects. Taking long-dated bonds out of the market leaves investors holding fewer of them, which is meant to push their prices up and their yields down. Lower long-term yields feed into mortgage rates and corporate borrowing costs, and the extra reserves give banks more cash to lend or invest.

The reverse, quantitative tightening. In both of its runoffs the Fed did not sell bonds. It stopped reinvesting some of the money it received as bonds matured or were paid down, up to monthly caps set in advance. The holdings shrink, and reserves shrink with them. The Fed calls this reducing its securities holdings; markets call it runoff or QT.

Why “money printing” is a loose name. Reserves stay inside the banking system. They become money in people’s hands only if banks lend more, so the link between QE and prices in shops depends on what banks and borrowers do next. Inflation covers the other side of that question.

A worked example

QE2, as the Fed announced it on 3 Nov 2010: the Committee said it intended “to purchase a further $600 billion of longer-term Treasury securities by the end of the second quarter of 2011, a pace of about $75 billion per month.”

The arithmetic of the plan: 8 months at about $75 billion = $600 billion.

What the Fed’s weekly data recorded. Securities held outright were $2,042.7 billion on Wednesday 3 Nov 2010 and $2,642.6 billion on Wednesday 29 Jun 2011, 34 weeks later:

1. Change in securities held: $2,642.6 billion - $2,042.7 billion = +$599.9 billion.
2. Treasury securities: +$775.1 billion.
3. Mortgage-backed securities: -$142.2 billion.

Read plainly: holdings rose by the promised $600 billion, but Treasuries rose by more than that. Since 10 Aug 2010 the Fed had been “reinvesting principal payments from agency debt and agency mortgage-backed securities in longer-term Treasury securities,” so as its mortgage bonds were repaid, the money went into Treasuries and the mix shifted.

The original data

Every round from the Fed’s H.4.1 release, Table 5, which reports the balance sheet of all Federal Reserve Banks each Wednesday. The file downloaded on 27 Sep 2026 runs from 18 Dec 2002 to 23 Sep 2026, 1,241 weeks. Each round starts at the last Wednesday on or before the announcement, or the start of runoff, and ends at the Wednesday nearest the end date in the Fed’s own statement. Two ends needed a choice: the pandemic round uses 9 Mar 2022, because the Fed said only “early March”, and the 2022 to 2025 runoff uses 26 Nov 2025, the last Wednesday before it ended on 1 Dec 2025. The 10-year yield is FRED’s DGS10 on the same dates.

The pandemic round was larger than the three earlier rounds combined, +$4,549.9 billion against +$3,762.7 billion for QE1, QE2 and QE3 together. The 2022 to 2025 runoff then reversed 49.1% of it. QE1’s securities figure also includes about $156.5 billion of debt issued by the housing agencies, which is why the Treasury and mortgage columns do not add up to the total on that row.

Total assets, the line most charts show, were $719.5 billion on 18 Dec 2002. They peaked at $8,965.5 billion on 13 Apr 2022, fell to $6,535.8 billion on 3 Dec 2025, and stood at $6,747.7 billion on 23 Sep 2026. Every week is in the weekly balance sheet table, and the round figures in the QE rounds table.

The 2008 jump that was not QE

Between 10 Sep and 31 Dec 2008, the Fed’s total assets rose from $925.7 billion to $2,239.5 billion. Over the same weeks its holdings of securities went from $479.8 billion to $495.6 billion. Almost all of the increase was emergency lending to banks and markets during the financial crisis, not bond buying.

QE1 then replaced that lending with securities. Across its 71 weeks, securities held rose $1,525.5 billion but total assets rose only $120.0 billion, because the crisis loans were being repaid as the purchases settled. A chart of total assets alone hides that swap, which is why the table above measures securities held outright.

Is the 2025 bill buying QE?

On 10 Dec 2025 the Fed said it would “initiate purchases of shorter-term Treasury securities as needed to maintain an ample supply of reserves on an ongoing basis.” It had ended runoff on 1 Dec 2025. Since then its securities have risen $226.1 billion.

The 10 Dec 2025 statement does not call them an asset purchase program. They are short-dated bills bought to keep reserves at the level it wants, not long-dated bonds bought to push down long-term yields. The size is also different: $226.1 billion over 41 weeks, against the $75 billion a month QE2 set out to buy.

When it fails

It fails as an explanation when yields are read on their own. The 10-year yield rose during all four buying rounds and fell during the 2017 to 2019 runoff, the opposite of the simple story. Yields also move with growth, inflation expectations and the policy rate. The table cannot show what yields would have been without the purchases, and with four rounds there is nothing to test it on.

It fails as a market signal. Seven periods are far too few to link the balance sheet to stock prices, and each round began in a crisis or a weak recovery that moved markets for its own reasons.

It fails when total assets are read as QE. Late 2008 is the plain case: a doubling of the balance sheet with almost no change in bonds held.

And it has costs the table does not show. When short-term rates rise above the yield on the bonds the Fed bought, the interest it pays on reserves can exceed what the bonds earn. The Fed’s statements cited in the sources describe the purchases and runoff; they do not settle whether the trade-off was worth it.

Related

Central banks covers the policy rate that comes before any QE, and the bond market is where the purchases happen. The yield curve shows the long-term rates QE aims at, inflation the risk critics raise about it, and stagflation the case where rising prices and weak growth arrive together.

This page is educational, not financial advice. Test every idea on your own charts before risking money.