interest rate fallacy

Just Who Was The Intended Audience For The Rate Cut?

By |2019-09-04T17:20:30-04:00September 4th, 2019|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

Federal Reserve policymakers appear to have grown more confident in their more optimistic assessment of the domestic situation. Since cutting the benchmark federal funds range by 25 bps on July 31, in speeches and in other ways Chairman Jay Powell and his group have taken on a more “hawkish” tilt. This isn’t all the way [...]

Europe Comes Apart, And That’s Before #4

By |2019-05-29T11:21:31-04:00May 29th, 2019|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

In May 2018, the European Parliament found that it was incredibly popular. Commissioning what it calls the Eurobarameter survey, the EU’s governing body said that two-thirds of Europeans inside the bloc believed that membership had benefited their own countries. It was the highest showing since 1983. Voters in May 2019 don’t appear to have agreed [...]

Central Bankers Follow Bonds, Then Insist They Aren’t And That Bonds Agree With Them

By |2019-05-24T13:04:09-04:00May 24th, 2019|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

When central bankers use the word “financial” in an economic context, they mean exclusively stocks. Maybe that’s somewhat appropriate given how bonds are so often treated as monetary equivalents. Then again, if that is the case in the official view, how does anyone reconcile bonds with anything? Economy or money? The hard answer is that [...]

The Forced Exile Of Bond Vigilantes

By |2019-04-08T15:35:18-04:00April 8th, 2019|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

Japan is the very model of fiscal irresponsibility. If ever there was a bond vigilante, surely they would have a Japanese address. At the end of what was the Bank of Japan’s 133rd fiscal year, on March 31, 2018, Japan’s central bank reported total assets of ¥528,285,679,854,140. Of which, ¥448,326,107,324,120 was Japanese government bonds (JGB). [...]

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