This tag is associated with 16 posts

Have Central Banks Lost Their Way?

By Stephen S. Roach Fixated on inflation targeting in a world without inflation, central banks have lost their way. With benchmark interest rates stuck at the dreaded zero bound, monetary policy has been transformed from an agent of price stability into an engine of financial instability. A new approach is desperately needed. The US Federal Reserve … Continue reading

The Fed Can’t Raise Rates, But Must Pretend It Will

By Thorsten Polleit Waiting for Godot is a play written by the Irish novelist Samuel B. Beckett in the late 1940s in which two characters, Vladimir and Estragon, keep waiting endlessly and in vain for the coming of someone named Godot. The storyline bears some resemblance to the Federal Reserve’s talk about raising interest rates. Since … Continue reading

The U.S. Dollar: The Modern Day Bancor

By Eugen von Böhm-Bawerk According to Belgian-American economist, Robert Triffin the country whose currency have become the global reserve currency must be willing to supply enough liquidity to satisfy global needs. This obviously raises an interesting question for the Federal Reserve with regard to their monetary policy execution. On one hand, they need to consider the … Continue reading

The Federal Reserve Is In Panic: The Growth Of Employment Is “Submerged in Economic Stagnation”

The ego of Janet Yellen has broken into a thousand pieces. The new data published some days ago by the US Department of Labor confirms the hypothesis of economist Ariel Noyola Rodríguez, who has maintained since last year that the United States’ labour market was much more fragile than was presumed by the head of the … Continue reading

U.S. Recession Watch: Why NIRP — And Not A Lift-Off — Is Most Likely The Fed’s Next Move

By Eugen von Böhm-Bawerk In The Coming US Recession Charted (June 20, 2015) we argued that the US economy is heading toward recession, not escape velocity as the sell-side and Fed officials have been telling us. Today we will revisit the possibility of the US entering a recession in 2016 and by extension substantiate our argument … Continue reading

Is More QE, NIRP, Cash Bans, And Capital Controls On The Horizon For The Fed?

By Eugen von Böhm-Bawerk The Fed unsurprisingly chickened out from the much touted September hike. International conditions and a disapproval from Mr. Market was enough to unnerve an increasingly bewildered FOMC board. Less well known is the fact that the FOMC gave a strong, and unexpected, signal to the Pavlovian world of central bank front runners. … Continue reading

How The Chinese Economy Is Affecting U.S. Fed Policy

By Martin Feldstein Janet Yellen’s speech on September 24 at the University of Massachusetts clearly indicated that she and the majority of the members of the Federal Reserve’s Federal Open Market Committee intend to raise the short-term interest rate by the end of 2015. It was particularly important that she explicitly included her own view, … Continue reading

Markets Gone Mad: Detox After 6 Years Of Zero Rates And Liquidity Injections By The Fed

By Mike Whitney Imagine your doctor put you on a daily dose of oxycontin, phenobarbital and Quaaludes for six years straight. Then he suddenly cancelled your prescription.  Do you think your behavior might become a bit erratic? This is what’s going on with the stock market. It’s trying to shake off six years of overmedication brought … Continue reading

Weekly EM/FM Risk Outlook: 9/21 – 9/27

By Brian Daigle China’s President Xi Jinping makes first official visit to the United States. South American leaders meet amid tensions between UNASUR nations. EU officials meet to discuss the ongoing migrant crisis. Pope Francis speaks to the U.S. Congress. Interest rate decisions in major developing markets. All this in the Weekly Risk Outlook. President Xi Pays First Official Visit … Continue reading

Mark Mobius: A Fed Move Could Be Good News For Emerging Markets

By Mark Mobius, Templeton Emerging Markets Group After months (if not years) of speculation and debate, the US Federal Reserve (Fed) has left the financial markets in a holding pattern once again, deciding to keep its benchmark short-term interest rate steady at near zero. In our view as investors in emerging markets, this isn’t necessarily positive news, … Continue reading

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