If it shows up at the Federal Reserve, you can pretty much bet everything you own that it was tried out at the Bank of Japan first. And if it was the brilliant brainchild of someone at the BoJ, then you’re guaranteed it failed spectacularly. Which means, obviously, the “ideal” technocrats at the Fed intentionally copied something they knew had [...]
Where is it, Chairman Powell? After spending months deliberately hyping a “flood” of digital money printing, and then unleashing average inflation targeting making Americans believe the central bank will be wickedly irresponsible when it comes to consumer prices, the evidence portrays a very different set of circumstance. Inflationary pressures were supposed to have been visible by now, seven months and [...]
With all eyes on Washington DC, today, everyone should instead be focused on Europe. As we’ve written for nearly three years now, for nearly three years Europe has been at the unfortunate forefront of Euro$ #4. We could argue about whether coming out of GFC2 back in March pushed everything into a Reflation #4 – possible - or if this [...]
Why do we care so much about inflation targeting in any form? Ask that question of a central banker and they will merely state the answer is self-evident before calling the police to have you arrested and thrown in jail for daring to query. Inflation targeting is central to this version of the central bank, so much so it has [...]
Before the word “taper” ever left the lips of anyone occupying an official position at the Federal Reserve in the late spring of 2013, there was already something very much amiss. Not that you would have known it, of course. In the financial media, everything was moving along swimmingly, Bernanke the thrice-crowned hero. QE4 had been dutifully buried by its [...]
Mario Draghi was a very polarizing figure for him to be atop a central bank that has no natural constituency. Sure, there is a European Central Bank but there remain National Central Banks which had retained their own powers and influence following the monetary union. Draghi’s approach rubbed critics the wrong way, a growing legion of them, a lot of [...]
There is no oil in the CPI’s consumer basket, yet oil prices largely determine the rate by which overall consumer prices are increasing (or not). WTI sets the baseline which then becomes the price of motor fuel (gasoline) becoming the energy segment. As energy goes, so do headline CPI measurements. And that’s a huge problem…if you are Jay Powell. We’ve [...]
On June 24, Europe’s central bank, the ECB, settled what it called T-LTRO III. Technically, this was an open market operation (OMO) and therefore a specific kind of LTRO. The “T” part of the program doesn’t really matter unless you happen to be running the short desk at a major European bank. For the public, the Roman numeral “III” added [...]
The Bureau of Labor Statistics reported that the core CPI in July 2020 jumped by the most (+0.62%) in almost thirty years. After having dropped month-over-month for three months in a row for the first time in its history, it has posted back to back gains the latest of which pushing the index back above its February level. Congratulations to [...]
When people accuse the Federal Reserve of anything when it comes to inflation, they say the central bank is cooking the books to hide it. Back in 2000, for example, monetary observers were aflutter as policymakers shifted away from the CPI and to the PCE Deflator as their ultimate standard for broad consumer price behavior. The bastards, the latter widely [...]
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