Post Tagged with: "Federal Reserve"
Chart of the Day: Gold reacts to FOMC rate easing
The Fed has come out 9-1 in favor of rate easing i.e. capping medium-term treasury rates. The interesting bit is that while the Fed did the exact same thing in August out to two years, this announcement takes permanent zero out to nearly three years. That’s rate easing. Some people call it financial repression. And it’s gold bullish
Chart of the Day: Is Gold About to Get a Monetary Blast (Off)?
Watch gold as it pushes up against the downtrend line. Any hints from the Fed of QE3 could send it “to the Moon, Alice!” The Fed rejoining the party and the LTRO2 coming next month could be an explosive mix
Sucking up to power, Timothy Geithner edition
You have probably heard a lot of noise about what was said about the housing bubble at Federal Reserve meetings in 2006. There is a quote from Timothy Geithner, then the NY Fed chief, that I think is quite revealing
The continuing saga of bank self-regulation and other fairy tales featuring Alan Greenspan
We continue to witness remarkable developments in the intersection of the related fields of economics, finance, ethics, law, and regulation. Each of these five fields ignores a sixth related field – white-collar criminology. The six fields share a renewed interest in trust
Geithner’s Ploy: Saving U.S. Banks at Taxpayer Expense, Once Again
Mr. Obama’s Secretary Geithner went to Europe met with EU leaders to demand that Greece make the write-downs voluntary on the part of banks and creditors. He explained that U.S. banks had bet that Greece would not default – and their net worth position was so shaky that if they had to pay on their bad gambles, they would go broke
PIMCO’s El-Erian: QE3 won’t produce the outcomes we want
Bloomberg wrote the following paragraphs about a recent interview with Mohamed El-Erian. What i thought was interesting was his belief that the Fed is out of bullets. Monetarists and Keynesians believe the Fed can still be effective by managing expectations. So the Fed is on a mission to improve its communication of interest rate policy. Like El-Erian, I am sceptical of this policy turn, but what else can the Fed do? They say they have lots of tools left. Do they
What has the Fed done to avoid the US becoming the next Japan?
Imagine being on the FOMC and in the mainstream paradigm. In 2008 you moved quickly to make sure the US would not become the next Japan. What do you have to show for it, 3 years later
The Fed’s definition of “clarity” is not like yours or mine
Each member will be asked to give a number for what they think the interest rate will be at the end of this year, the end of next few years and also in the long run. Won’t it be confusing to have 12 different predictions for this
ECB/Fed Support for the European Banking System – 750 billion USD, and counting …
It is my view that the ECB is now the only thing between the economy and widespread bank failures, but I also concur that the consequence of this is a permanent outsourcing of the interbank market in Europe to the ECB’s balance sheet and, quite possibly, Fed’s USD swap lines
Government Spending with Self-Imposed Constraints
Let’s see how it is really done in the US—where the Treasury really does hold accounts in both private banks and the Fed, but can write checks only on its account at the Fed. Further, the Fed is prohibited from buying Treasuries directly from the Treasury (and is not supposed to allow overdrafts on the Treasury’s account)
Bernanke’s 29 Trillion Dollar Fog of Deceit
Congress should immediately call Chairman Bernanke in for testimony on the veracity of the Fed’s response to the Bloomberg report. It should demand a comprehensive accounting for all the Fed’s commitments, by institution that benefitted. Bernanke should explain what the Fed did, when it did it, why it did it, and in whose interests it has been operating since the GFC began. No more obfuscation. No more secrecy. No more fog of deceit
Forecasting misconceptions and the likelihood of European financial repression
Market participants, including economists and strategists are prone to confusing what they believe should be the case with what will be the case