Despite being the last FOMC meeting before the ever-expected rate hike in September , there was a whole bunch of nothing in markets before and even after the policy statement. Even the typical knee-jerk was less than on prior meetings. Maybe traders have come to expect so very little from the policy statement, focusing more on the inanities and silliness [...]
With all the problems right now beyond Greece and China, from Canada’s “puzzling” recession to Brazil’s unfolding disaster, and even the still-“shocking” US economic slump, it is interesting that gold garnered the most attention in early Monday trading. The fact that gold prices were slammed in Asian trading was certainly significant, but that really isn’t why gold is being highlighted [...]
When US retail sales jumped in May on seasonal adjustments alone, economists and mainstream commentary lost all composure as they were certain that meant the “slump” was over and the dominant narrative would continue. The same occurred in Europe over a slight pickup in overall lending, not even in the household or business sectors, which was proclaimed as nothing but [...]
There should be no more “ifs”, no more caveats and qualifications. After trillions of printed illusions through four QE’s and now almost seven years of ZIRP, she still can’t say for certain whether the economy is actually performing. However, the fact that Janet Yellen won’t say so is all the evidence you need, as for surely by now, especially given [...]
The FOMC policy statement released last month wasn’t improved by the “minutes” publicized today. If you believe the committee is “hawkish” then there is plenty for you to find agreement; the opposing equally so. From what I see, they spend an inordinate amount of time and words on the labor market, but after repeated emphasis that instead of fashioning confidence [...]
For the most part, the concept of leverage is straightforward and intuitive. In physics, a lever is something that multiplies force to gain mechanical advantage. That is why the word was transported to finance as it means to multiply the effort of a small capital base. The “mechanical” force applied in the form of financial leverage used to be borrowed [...]
Just a few weeks ago the Swedish central bank, Riksbank, was being lauded for its courage and action in finally embracing QE as the ECB had done. The deflation problem in Sweden had been, so it is asserted, seemingly intractable and thus forcing the monetary hand once more. Riksbank has never been shy about fine-tuning here and there, so it [...]
An old Wall Street saying opines that one shouldn't "fight the Fed" and it is said to be good advice. The popular belief about this saying is that it means one should embrace risk when the Fed is easing because ultimately the goal of the easing (more growth) will be accomplished. When the Fed is tightening one should shun risk, assuming that [...]
The June FOMC statement has done nothing to clear up any suspicions in either direction for credit markets. I think that is actually consistent, in an irrational way, as the FOMC tries to labor under the delusion of recovery, which these “markets” are bound to at least consider, while all good sense says there is none. The result is markets [...]
I am more convinced than ever that the FOMC is simply trying to scare a recovery into existence. The June update to the Fed’s models for central economic tendencies were, in a word, atrocious. The economy was marked down in almost every facet, and not by a little. The upper boundary on the central tendency for GDP was dropped by [...]
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