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    Teens are worried about the U.S. economy, but they're still spending on Nike and Lululemon

    Teens are spending more and shifting their shopping habits, even as they worry over growing economic uncertainty, according to Piper Sandler’s biannual “Taking Stock With Teens” survey.
    They’re also increasingly concerned about the Russian war in Ukraine, and less preoccupied with the Covid-19 pandemic.
    Plus, many teens say they’re either unsure of or uninterested in the so-called metaverse.

    Athletic apparel sits on display inside a Lululemon Athletica store.
    Xaume Olleros | Bloomberg | Getty Images

    Teens are spending more and shifting their shopping habits, even as they worry about growing economic uncertainty, according to a new survey.
    Athletic apparel brands such as Lululemon and Nike that combine comfort and fashion are winning out over traditional clothing labels, Piper Sandler’s biannual “Taking Stock With Teens” report released on Wednesday revealed.

    Many teens say they’re either unsure of or uninterested in the so-called metaverse — the idea of buying goods through a virtual reality experience. Retailers including Nike, PacSun, Forever 21 and Ralph Lauren have all been dipping their toes in the budding technology.
    A growing number of teenagers also say they’re much more familiar with NFTs, or non-fungible tokens, than they were last fall, while only a small percentage have actually purchased one.
    But they’re also increasingly concerned about the Russian war in Ukraine, the survey revealed, and are less preoccupied with the Covid-19 pandemic.
    The results of the biannual survey have implications for the businesses vying to win over this generation’s dollars. That’s particularly true now with the economic environment riddled with uncertainty.
    Teens plan to spend about $2,367 this year on everything from fast food meals and video games to handbags and sneakers, Piper Sandler found, or an estimated overall total of roughly $66 billion. That’s up 9% from reported spending levels in the spring 2021 report, and up 4% from Piper Sandler’s fall survey. Reported annual spending by teens peaked at about $3,023, in the spring of 2006. 

    Piper Sandler surveyed 7,100 teens from Feb. 16 to March 22. The average age of those surveyed was 16.2 and the average household income was $69,298. Thirty-nine percent of the teens surveyed were employed part-time, up from 38% last fall and 33% last spring.

    Concerns about the economy on the rise

    Though teen-spending levels have improved steadily since a trough in the fall of 2020, businesses still grapple with the question of what could derail growth and whether consumers will pull back in their spending.
    A whopping 71% teens reported to Piper Sandler that they believe the U.S. economy is getting worse, up from 56% who felt that way last fall, and 46% last spring.
    When asked which political or social issues mattered the most to them, teens’ top response was Russia’s invasion of Ukraine, at 13%. That was followed by the environment, at 11%; racial equality, at 10%; gas prices, at 10%; and inflation, at 4%.
    Coronavirus notably fell off the list of teens’ top 10 concerns, after ranking fourth in Piper Sandler’s survey last fall as well as last spring.
    Piper Sandler consumer analyst Matt Egger noted that the continued concern among Generation Z consumers on the environment bodes well for rental platforms such as Rent the Runway and resale businesses like ThredUp and The RealReal.

    Nike, Amazon keep top spots

    Meanwhile, Nike remained the No. 1 favored clothing brand among teens, a spot it has held for an impressive 11 consecutive years. It also widened its margin as the preferred footwear brand among Gen Z shoppers, the survey said, ahead of Converse, Adidas, Vans, New Balance and Crocs, in that order.
    American Eagle kept its spot as teens’ second-favorite apparel brand, followed by Lululemon, which moved up one position on the list from the prior year. Fast-fashion retailer H&M rose to fourth from ninth a year earlier. Adidas remained in fifth place.
    Overall, the athletic brands mentioned in the survey released Wednesday accounted for 44% of teens’ favorite clothing labels, the highest levels that Piper Sandler has seen for the category. That aligns with a broader shift among consumers during the pandemic, toward stretchy and more loose-fitting clothing to be worn around the house. And many teens are still incorporating athletic brands into their wardrobes even as they head back to schools and offices.
    Shein, a Chinese e-commerce fashion behemoth that is reportedly weighing a funding round at a valuation of about $100 billion, ranked seventh for teens’ favorite place to buy clothes, down from sixth in the fall of 2021 but up from eighth last spring.
    Females continue to widely outspend males on clothing, according to the Piper Sandler survey, while males spend, on average, about $51 more that females on shoes each year.
    Amazon remained by far the favorite website to shop overall, taking a 53% share, up from 52% last fall. Shein remained in second place, but its share of teens’ preference fell to 8% from 9%. Other retailers on the list were Nike, PacSun, Lululemon and Princess Polly, in that order.
    When it comes to the metaverse and platforms such as Roblox or Decentraland, 26% of teens reported they own some sort of virtual reality device, with just 5% using it daily. Forty-eight percent said they are either unsure of or not interested in the metaverse.

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    Key people from the Fed just spooked the markets — here's what they said

    Fed Governor Lael Brainard and San Francisco Fed President Mary Daly spoke Tuesday, emphasizing the central bank’s commitment to fighting inflation through higher interest rates.
    “It is of paramount importance to get inflation down,” Brainard said.
    Raising rates “is what is necessary to ensure that again, [you] go to bed at night, you’re not worrying about whether prices will be higher, considerably higher tomorrow,” Daly added.

    If there was any question about where the Federal Reserve stands on the key issue of the day — inflation — two important officials brought even more clarity on Tuesday.
    Fed Governor Lael Brainard and San Francisco Fed President Mary Daly both issued comments that showed they both envision higher rates and, in the former’s case, an aggressive drawdown of the assets the central bank is holding on its balance sheet.

    Investors didn’t particularly like what they heard, sending major averages considerably lower on the day and the 10-year Treasury yield to a new 2022 high.

    Lael Brainard, governor of the U.S. Federal Reserve, speaks during a Senate Banking, Housing, and Urban Affairs Committee confirmation hearing in Washington, D.C., U.S., on Thursday, Jan. 13, 2022.
    Al Drago | Bloomberg | Getty Images

    “It is of paramount importance to get inflation down,” Brainard said during a Minneapolis Fed webinar. The Federal Open Market Committee, which sets interest rates, “will continue tightening monetary policy methodically through a series of interest rate increases and by starting to reduce the balance sheet at a rapid pace as soon as our May meeting.”
    The comments helped knock down a positive opening on Wall Street that ultimately turned into a nearly 1% loss for the Dow Jones Industrial Average. The more aggressive Fed chatter also comes as the 30-year fixed mortgage rate topped 5%, a key threshold which could slow the housing market.

    ‘We’re not going to let this go forever’

    Later in the day, Daly said inflation running at a 40-year high “is as harmful as not having a job.” Speaking to the the Native American Finance Officers Association, she assured the group that the Fed is on the case.
    “Most Americans, most people, most businesses, hopefully people in tribal nations, you all have confidence that we’re not going to let this go forever,” Daly said. “But if you don’t have that confidence, let me give it to you.”

    She assured those in attendance several times that interest rates are heading higher, though she added that she doesn’t think it will cause a recession.
    Raising rates “is what is necessary to ensure that again, [you] go to bed at night, you’re not worrying about whether prices will be higher, considerably higher tomorrow,” Daly added.
    The Fed already has enacted its first rate hike of the year, a 0.25 percentage point move in March. Markets expect increases at each of the six remaining meetings this year, possibly totaling 2.5 percentage points.

    Two policy ‘doves’

    What made the two officials’ comments more striking is that they are considered to be in the camp of Fed “doves” — meaning that they usually favor low rates and less restrictive policies. That they both see a rather urgent need to tighten underscores how seriously the Fed is taking the threat.
    Brainard’s voice carries a little extra heft in that she has been nominated to be vice chair of the FOMC, a position that makes her the top lieutenant for Chairman Jerome Powell.

    Stock picks and investing trends from CNBC Pro:

    Brainard said she expects the Fed’s $9 trillion balance sheet to “shrink considerably more rapidly” than was the case during the last rundown in 2017-19. In that episode, the Fed allowed $50 billion a month in proceeds from maturing bonds to roll off while reinvesting the rest. Her comments opened the door to what many economists expect to be a monthly roll-off around $80 billion to $100 billion.
    Reducing the balance sheet “will contribute to monetary policy tightening over and above the expected increases in the policy rate,” Brainard added.
    “Currently, inflation is much too high and is subject to upside risks. The Committee is prepared to take stronger action if indicators of inflation and inflation expectations indicate that such action is warranted,” she added.
    Daly echoed the idea that the balance sheet reduction could start in May, adding that the Fed’s commitment to fighting inflation “will mean interest rates go up.”
    “But inflation, what people are paying day in and day out is on the minds of everyone, they go to bed at night thinking about it wake up in the morning thinking about rent, transportation, gas prices, food prices, so we as a Federal Reserve are on a path to raise the interest rates,” she said.

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    CDC director says high immunity in U.S. population provides some protection against omicron BA.2

    CDC Director Rochelle Walensky said high levels of immunity from vaccination, boosters and prior infection should provide some protection against the omicron BA.2 variant in the US.
    BA.2 makes up a growing a proportion of variants in the U.S., but new infections are steady at the moment. Hospitalizations are at their lowest level since 2020.
    BA.2 has caused major outbreaks in Europe and China.

    Centers for Disease Control and Prevention (CDC) Director Rochelle Walensky gives her opening statement during the Senate Health, Education, Labor and Pensions hearing on “Next Steps: The Road Ahead for the COVID-19 Response” on Capitol Hill in Washington, November 4, 2021.
    Elizabeth Frantz | Reuters

    CDC Director Rochelle Walensky on Tuesday said there is enough immunity in the U.S. population to provide some protection against the more contagious omicron BA.2 subvariant, which could help stave off another Covid wave that slams hospitals.
    “The high level of immunity in the population from vaccines, boosters and previous infection will provide some level of protection against BA.2,” Walensky said during a White House Covid briefing. White House chief medical advisor Dr. Anthony Fauci said last month that infections might rise due to BA.2, but he doesn’t expect another surge.

    BA.2 now represents 72% of circulating Covid variants in the U.S., according to the Centers for Disease Control and Prevention. It has rapidly displaced the earlier version of omicron, BA.1, that caused the massive wave of infection over the winter. At the beginning of February, BA.2 represented about 1% of Covid variants in the U.S.

    BA.2 is now the dominant Covid variant in every region of the country, with circulation the highest in the densely populated Northeast, a repeated epicenter of the pandemic in the U.S. BA.2 makes up more than 80% of circulating variants in New England, New York, New Jersey, Puerto Rico and the Virgin Islands, according to the CDC.
    An estimated 95% of the U.S. population ages 16 and older had developed antibodies against the virus either through vaccination or infection as of December, according to a CDC survey of blood donor samples. However, simply having antibodies against the virus does not necessarily stop an infection. Omicron, with its many mutations, has an enhanced ability to infect both the vaccinated and people who were previously infected.
    However, people who are vaccinated, boosted and those who recovered from a prior infection all have high levels of protection against hospitalization from BA.2, according to a study published by scientists in Qatar affiliated with Weill Cornell Medicine in Doha. The study has not undergone peer review.
    The scientists found that people who received three Pfizer shots had the highest protection against hospitalization from BA.2 at 98%. People who received two Pfizer doses and those who recovered from a prior infection had similar levels of protection against hospitalization at 76% and 73% respectively. People who had two Pfizer doses and recovered from a breakthrough infection had 97% protection.

    The data suggests that even if BA.2 fuels an increase in infections in the U.S., there might be enough immunity in the population to prevent a major outbreak of severe disease that overwhelms hospitals.
    BA.2 is anywhere from 30% to 80% more transmissible than the earlier version of omicron, according to public health authorities in the U.K. and Denmark. Scientists in the U.K., South Africa and elsewhere have found that BA.2 generally does not make people more sick than BA.1, which was less severe than the delta variant.
    BA.2 has fueled outbreaks in Europe, including in the United Kingdom and Germany. China is battling its worst wave since 2020, locking down major cities such as Shanghai.
    However, Covid infections in the U.S. are steady right now even as BA.2 makes up a growing proportion of virus variants in circulation around the country. The U.S. reported an average of about 25,000 new infections on Monday, down 4% from the week prior, according to data from the CDC. However, new infections are likely underreported as many people use at-home tests that aren’t captured by the data.
    The number of people hospitalized with Covid has fallen to the lowest since 2020. More than 10,700 patients were hospitalized with the virus on Tuesday as a seven-day average, a 92% drop from the peak of the omicron wave in January, according to data from the Health and Human Services Department.
    The CDC has adjusted its Covid guidance to focus more on hospitalizations as a measure of how severely the virus is impacting the country. More than 97% of the U.S. population lives in counties with low-to-moderate Covid levels, which means people there do not need to wear masks under the CDC’s guidance.

    CNBC Health & Science

    Read CNBC’s latest global coverage of the Covid pandemic:

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    JetBlue makes all-cash offer for Spirit Airlines, complicating planned Frontier tie-up

    JetBlue Airways made a $3.6 billion all-cash offer for Spirit Airlines, raising questions about Spirit’s deal to combine with rival discount carrier Frontier Airlines.
    The bid comes less than two months after Spirit and Frontier agreed to merge into a discount airline behemoth.
    Trading in Spirit shares was halted before the market closed Tuesday after the stock spiked more than 22% to $26.92.

    JetBlue Airways made a $3.6 billion all-cash offer for Spirit Airlines, raising questions about Spirit’s deal to combine with rival discount carrier Frontier Airlines.
    Spirit said its board was evaluating JetBlue’s proposal and will “pursue the course of action it determines to be in the best interests of Spirit and its stockholders.”

    The competition for Spirit shows renewed appetite for consolidation in the airline industry as carriers dig their way out of two difficult pandemic years. Carriers are now scrambling to hire pilots, flight attendants and other workers as the travel business rebounds.

    Spirit Airlines planes on the tarmac at the Fort Lauderdale-Hollywood International Airport on February 07, 2022 in Fort Lauderdale, Florida.
    Joe Raedle | Getty Images

    JetBlue’s bid comes less than two months after Spirit and Frontier agreed to merge into a discount airline behemoth, which would make it the country’s fifth-largest airline.
    Trading in Spirit shares was halted before the market closed Tuesday after the stock spiked more than 22% to $26.92. JetBlue offered $33 a share in its unsolicited all-cash bid, Spirit and JetBlue said. The New York Times earlier reported JetBlue’s offer.
    JetBlue shares closed down about 7%.

    Spirit and Frontier both solely fly planes in the Airbus A320 family. Those aircraft make up the majority of JetBlue’s fleet, as well, which would reduce costs and logistical headaches in combining the carriers.

    JetBlue also has a large operation in Florida, where Spirit is headquartered. It said the combined airline would have 32,000 employees and would keep its headquarters in New York.
    “We can all agree that Spirit has a very different brand and product than JetBlue, and so at first glance you may not think we’d make a great pair,” JetBlue CEO Robin Hayes and COO Joanna Geraghty wrote to employees after announcing the bid for Spirit. “However, when you dig deeper, you’ll realize we could be a perfect match. After all, our strong belief has always been that Customers shouldn’t have to choose between a low fare and a great experience, and JetBlue is the only airline that offers both.”
    A wave of consolidation in the airline industry that began more than a decade ago left four major carriers in control of more than 70% of the U.S. market.
    “Once you have megacarriers with more than 1,000 aircraft after the backbone of the industry, then it’s appropriate for the No. 5 airline to beef up,” said Samuel Engel, senior vice president and aviation analyst at consulting firm ICF.
    JetBlue has a partnership with American Airlines that allows the carriers to coordinate service in the U.S. Northeast. The two airlines see the agreement as giving them a better chance to compete against United and Delta Air Lines in crowded airports in New York and Boston. The Department of Justice sued to block that partnership last year.
    The DOJ and American both declined to comment on JetBlue’s offer for Spirit, though JetBlue said Tuesday the merger with Spirit would complement its alliance with American.
    Frontier defended its deal to combine with Spirit and said an alternative tie-up with JetBlue would make travel more expensive. The airline also questioned JetBlue’s offer amid the Justice Department lawsuit.
    “In particular, the significant East Coast overlap between JetBlue and Spirit would reduce competition and limit options for consumers,” Frontier said. “It is surprising that JetBlue would consider such a merger at this time given that the Department of Justice is currently suing to block their pending alliance with American Airlines.”

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    These three LNG plays are worthy investments, Jim Cramer says

    Monday – Friday, 6:00 – 7:00 PM ET

    CNBC’s Jim Cramer on Tuesday picked three liquified natural gas stocks investors should consider purchasing.
    “Two are pure plays on liquefied natural gas exports – a little dicier – and then one is a more diversified story, really perfect for home-gamers who are worried about volatility,” the “Mad Money” host said.

    CNBC’s Jim Cramer on Tuesday picked three liquified natural gas stocks investors should consider purchasing.
    “Two are pure plays on liquefied natural gas exports – a little dicier – and then one is a more diversified story, really perfect for home-gamers who are worried about volatility,” the “Mad Money” host said.

    Russia’s ongoing invasion of Ukraine has led the U.S. to raise concerns about restricted supply of commodities, like energy and food, as well as implement economic sanctions against Russia. The U.S said in late March that it will work with global partners to provide at least 15 billion cubic meters more of liquified natural gas to Europe this year in an attempt to lessen reliance on Russian imports. 
    U.S. natural gas futures jumped about 6% to a nine-week peak on Tuesday.
    Front-month gas futures rose 32.0 cents, or 5.6%, to settle at $6.032 per million British thermal units (mmBtu), their highest close since Jan. 27, Reuters reported.
    Here is Cramer’s list of three LNG stocks he believes investors should be eyeing, starting with his favorite:
    Sempra Energy

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    Sempra Energy is “not a pure play, but does have a nice LNG export business,” Cramer said.
    “I like it long-term, as it’s the single best growth utility around with a terrific liquefied natural gas kicker. … If you’re looking for ways to play Europe’s demand for liquefied natural gas, I like Sempra Energy the best,” he said, adding that the business is “consistent” and its stock is still cheap relative to the company’s earnings.
    Cramer also discussed two other LNG stocks that he thinks could be investable: Cheniere Energy and Tellurian.
    Cheniere Energy

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    “It’s the safest pure play in the industry. … Analysts expect Cheniere’s sales and earnings to peak this year. If you believe the LNG business can stay strong beyond 2022, then you’ve got my blessing to buy this one, but otherwise it’s possible the good news is already baked in and we are in, suddenly, a not great stock market,” Cramer said.
    Tellurian

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    “Given that the stock has basically doubled since the end of last year, I think that you can afford to be patient here. Just wait for a better entry point,” Cramer said. 
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    Disclaimer

    Questions for Cramer?Call Cramer: 1-800-743-CNBC
    Want to take a deep dive into Cramer’s world? Hit him up!Mad Money Twitter – Jim Cramer Twitter – Facebook – Instagram
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    These four apartment REITs could be good opportunities for investors to cash in on skyrocketing rent prices, Jim Cramer says

    Monday – Friday, 6:00 – 7:00 PM ET

    CNBC’s Jim Cramer on Tuesday offered a list of apartment real estate investment trusts whose stock investors should consider buying to take advantage of soaring rent prices.
    “With rents skyrocketing all across America, and with an uncertain housing crisis because of mortgage rates, you might want to own one of the best apartment REITs,” the “Mad Money” host said.

    CNBC’s Jim Cramer on Tuesday offered a list of apartment real estate investment trusts whose stock investors should consider buying to take advantage of soaring rent prices.
    “Since higher rents are only good news for landlords, why not just buy a landlord, or at least a piece of a publicly traded landlord? Don’t just be a renter, be a rentier via one of the apartment real estate investment trusts,” the “Mad Money” host said.

    “With rents skyrocketing all across America, and with an uncertain housing crisis because of mortgage rates, you might want to own one of the best apartment REITs,” he later added.
    Median one-bedroom prices in March were up around 12% year-over-year while two-bedroom prices increased around 14% year-over-year, according to the Zumper National Rent Report.
    Cramer started with the 17 names in the FTSE NAREIT Equity Apartment Index before narrowing the list down to the 10 largest REITs. He then evaluated each name by comparing their numbers for each category:

    Same-store net operating income growth
    Projected revenue growth
    Projected funds from operations
    Valuation
    Dividend yields

    Using this criteria, Cramer came up with four winners that investors should keep their eyes on.
    Here are the top four apartment REITs:

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    Disclaimer

    Questions for Cramer?Call Cramer: 1-800-743-CNBC
    Want to take a deep dive into Cramer’s world? Hit him up!Mad Money Twitter – Jim Cramer Twitter – Facebook – Instagram
    Questions, comments, suggestions for the “Mad Money” website? [email protected]

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    Cramer's lightning round: Fisker is the ultimate speculative stock

    Monday – Friday, 6:00 – 7:00 PM ET

    It’s that time again! “Mad Money” host Jim Cramer rings the lightning round bell, which means he’s giving his answers to callers’ stock questions at rapid speed.

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    Nov Inc: “After some lean years, it’s time for the good years.”

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    Fisker Inc: “Fisker is the ultimate [speculative] stock, they’re going to lose money as far as the eye can see. … I think it’s a great spec, but it’s only a spec.”

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    The Federal Reserve prepares for quantitative tightening

    QUANTITATIVE EASING, or QE, once an unconventional tool of monetary policy, has become commonplace over the past decade. During the pandemic alone the Federal Reserve bought a staggering $3.3trn in Treasuries and $1.3trn in mortgage-backed securities as it sought to keep borrowing costs low. The reverse process, quantitative tightening (QT), when central banks shrink their balance-sheets, has been far rarer. The Fed is the only central bank to have truly attempted it, and it had to stop abruptly in 2019 because of market ructions. So its plan for reducing its assets—trailed in the minutes of its meeting in March, published on April 6th—takes it into relatively uncharted territory.Officials like to downplay the significance of QT. When at the Fed’s helm, Janet Yellen compared it to watching paint dry. Jerome Powell, her successor, says it will operate in the background. In truth it is akin to dismantling an auxiliary engine for the economy, with only hazy knowledge of the consequences.As Lael Brainard, a member of the Fed’s board, noted on April 5th, this round of QT will be more aggressive than the Fed’s previous iteration. With inflation racing ahead and the labour market tight, the central bank wants to cool the economy quickly. Coupled with interest-rate rises, QT is likely to be a drag on growth.So far the Fed has reinvested the proceeds of maturing bonds in order to maintain its stock of assets. The minutes suggest it is likely to shrink its balance-sheet not by actively selling them, but by letting some maturing bonds “roll off”, without reinvestment. The roll-off may start in May. Come July, all going well, the Fed will raise the maximum roll-off to $95bn per month, split between $60bn of Treasuries and $35bn of mortgage-backed bonds. At full tilt, the Fed could shrink its balance-sheet by more than $1trn over a 12-month period, twice as fast as its first go at QT. “Even if it’s done in a predictable way, this is a big adjustment for markets,” says Brian Sack of D.E. Shaw, an investment firm.Multiple rounds of bond-buying by central banks since the financial crisis of 2007-09 have yielded some understanding of how QE works. It signals a commitment to ultra-low interest rates. It suppresses long-term rates. And it supports liquidity, ensuring that markets operate smoothly.QT looks like QE in reverse. Instead of creating central-bank reserves (held by the private sector) by purchasing bonds, the central bank drains reserves by refraining from reinvesting as bonds mature. The three channels through which QE works also operate in reverse. First, QT sends a signal that rate rises are coming. Notably, it was in early January, when the Fed discussed a faster approach to QT than many had anticipated, that market rates shot up.The second channel—QT’s direct impact on yields—involves heroic guesstimates. Some analysts think the Fed will shrink its balance-sheet by $3trn over the next three years (taking it to about 20% of GDP, down from 36% now). Mark Cabana of Bank of America reckons this could equate to anywhere between a quarter point and 1.25 percentage points of rate increases—a remarkably wide range. Mr Powell has also noted the uncertainty about QT: “We have a much better sense, frankly, of how rate increases affect financial conditions.”When the Fed raises interest rates, it is raising overnight borrowing rates, which then ripple along the yield curve. With QT, the main impact is on longer-term yields. For some economists, such as Kristin Forbes of the Massachusetts Institute of Technology, this means that QT could be more potent than rate rises, since it would target hot segments of the credit market, such as mortgages. The Fed has said that it will stick with rate increases—the devil it knows—as its main tool. If, however, QT does hit longer yields, it may need fewer rate rises to tame inflation.The final channel is liquidity. As the Fed buys fewer bonds, there may be fewer transactions overall. Indeed, a Bloomberg index that measures the ease of trading Treasuries recently worsened to levels last seen at the pandemic’s start. That echoes uncomfortably with the past round of QT, which culminated in a liquidity crunch in the overnight-borrowing market. But the Fed is better prepared this time. There is much more cash in the market to begin with. And the Fed has set up an overnight-lending facility, which should let banks get funds if needed. “The risk of a spike in rates like we had in September 2019 is much, much lower,” says Bill Dudley, former president of the New York Fed.Yet new concerns will emerge. The Fed’s mortgage bonds have long tenors, so passive roll-offs would take decades. The central bank may have to make active sales, which it wants to avoid. Another concern is the Fed’s $326bn in short-term Treasury bills. Some observers think it will roll them off, supercharging QT; others fear that would stoke volatility. But the main worry is whether QT will work as intended, taking heat out of the economy without causing undue harm.For more expert analysis of the biggest stories in economics, business and markets, sign up to Money Talks, our weekly newsletter. More