For what it ever may have been worth, you have to at least acknowledge the Federal Reserve really did put its (own limited use form of) money where its abundant mouth had been. The entire story of the crisis era and then post-crisis experience of “abundant reserves” indicated a monetary situation (liquidity, colloquially) where supposedly money was beyond sufficient. Too [...]
Global factors. Both for inflation as well as money, in fact money therefore inflation. Only recently, yesterday, in fact, has the Federal Reserve pulled back the official curtain of silence and illiteracy if only a little to admit there’s so much more than what you’ve ever been told. Bank reserves aren’t the end of the story, especially in light of [...]
As usual, the focus went to the exact wrong place. In most people’s minds, the idea hammered home by the uniformly compliant financial press, it’s all about inflation and accommodative Federal Reserve policy. According to the current popular breeze, this along with Uncle Sam’s uncontrollable check-writing vigor has put the economy on course to overheating if not drastically so.Didn’t you [...]
Long-term Refinancing Operations (LTRO) became a standard non-standard monetary policy tool in the European Central Bank’s (ECB) toolkit late in 2011. A second confounding (global) banking crisis had struck yet again catching global policymakers with their pants down, this one seemingly centered directly upon Europe. On December 8, 2011, amidst constant rumors (probably real) that two of the major European [...]
China’s economy is nowhere near recovered from 2020’s steep recession, yet, contrary to textbook demands, the Chinese central bank is winding down its support. This is especially important given that monetary policy last year hadn’t actually been all that supportive to begin with (see below). The two major money outlets, currency and bank reserves, were allowed a noticeable yet only [...]
Treasury Secretaries, like Federal Reserve Chairmen, they don’t talk much about or pay much attention to the market’s need for collateral. They may pay some, but not specifically collateral if only under the vaguely defined category of “market consideration” when setting auction supply. Collateral shortages have come and gone, however dreadful, never eliciting a direct response insofar as supply has [...]
Trillions in “stimulus”, American consumers buying goods at a frenetic pace (in lieu of services), gasoline prices punishing, the start of favorable base effects, yet all those things couldn’t push the inflation rate much further beyond the Federal Reserve’s 2% explicit target. And remember, in order to meet the newly designed economic goals on the inflation side – average inflation [...]
Words have meaning for a reason, to convey precise ideas easily and readily understood by the reader or listener. If you use the term “stimulus”, as its root already suggests you’d expect something to be stimulated by whatever is being classified using this specific grouping of letters/sounds. Context rounds out the meaning.For the last twenty years, you’d have been wrong [...]
The US Treasury Department announced today that it has completed an auction of 20-year bonds. Quite unlike the one 7s auction – you know, that one – this particular bond sale was positively uninteresting. Like all the rest of the bills, notes, and bonds since February 25, there an overwhelming number of bank dealers and other participants some of whom [...]
For a short while, with reflation being traded in almost every corner of the global bond market, the Bank of Japan started to get “those” questions again. Almost of the humble brag variety. A few years ago, Japan’s central bank had widened what it considered to be an acceptable trading range for its 2016 QQE addendum of Yield Curve Control [...]
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