Jim Rickards makes the point that the 'stock becomes the flow'. In other words, it's not so much the interest but the MATURING securities themselves, several hundred billion dollars annually, which will be used to recycle and buy new treasuries on an ongoing basis. So QE officially ends from a marketing perspective but not so in practice.
While I agree with much of what JohnAus writes, I side with your counterpoint here 100%:
"Without the existence of the QE programme, there would be less demand for the UST at such low yields, and the US Gov would not be issuing as much (NEW!) debt onto the primary market. The issue of new debt which will imminently be purchased by the Fed on the secondary market, means the Fed has created cash.
(and the UST then stays on the Fed's balance sheet and the created $ remain, as evidenced by the earlier chart of the fed balance sheet i posted)
Are you saying that the Fed actually has existing cash on the LHS of it's balance sheet which it uses to purchase the debt securities off the secondary market?
AFAIK it doesn't - from the wiki page on QE, with a reference citing the BOE: The central bank buys government bonds and other financial assets, with new money that the bank creates electronically[1], in order to increase money supply and the excess reserves of the banking system."
