Overheard On The Street: The Volley Of Newly Printed Treasury Notes Keeps Us In Bond-Age

ALL PARTIES HAVE TO END, even ones thrown by the Federal Reserve.

By printing new money to buy bonds, the Fed boosted the amount of money it remits to the U.S. Treasury.

This circular process -- the Treasury pays interest to the Fed, which then sends it back to the government -- has helped limit borrowing and its cost.

Eventually, though, the economy should return to normality. When that happens, those remittances may dry up.

Last week, Congressional Budget Office forecast remittances will fall to zero in 2018 to 2020. This, the CBO said, will reflect expected sales of Fed holdings and the possibility that the central bank will "generate capital losses as interest rates rise." One bright spot: The government won't have to start sending money back to the Fed if it falls into the red. Rather, the CBO said, any net losses at the Fed would simply be netted off against future remittances.

In other words, the Fed need not suffer a hangover once money printing ends. If only that were true for everyone else.