ZIRP

The Obligatory Europe QE Review

By |2019-09-12T18:09:08-05:00September 12th, 2019|Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

If Mario Draghi wanted to wow them, this wasn’t it. Maybe he couldn’t, handcuffed already by what seems to have been significant dissent in the ranks. And not just the Germans this time. Widespread dissatisfaction with what is now an idea whose time may have finally arrived. There really isn’t anything to this QE business. [...]

What Kind Of Risks/Mess Are We Looking At?

By |2019-06-03T18:08:37-05:00June 3rd, 2019|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

The fact that the mainstream isn’t taking this all very seriously isn’t anything new. But how serious are things really? That’s pretty much the only question anyone should be asking. What are the curves telling us about what’s now just over the horizon? I hesitate to use 2008 comparisons too often because many people immediately [...]

How Do You Get A September Rate Cut?

By |2019-06-03T12:18:46-05:00June 3rd, 2019|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

When the eurodollar futures curve first inverted a year ago in the wake of May 29, 2018, it was the market beginning to hedge against serious and rising risks of something that would force the Federal Reserve to turn around. When that might happen, or how many cuts would eventually follow, those were questions the [...]

Proposed Negative Rates Really Expose The Bond Market’s Appreciation For What Is Nothing More Than Magic Number Theory

By |2019-05-21T16:10:42-05:00May 21st, 2019|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

By far, the biggest problem in Economics is that it has no sense of itself. There are no self-correction mechanisms embedded within the discipline to make it disciplined. Without having any objective goals from which to measure, the goal is itself. Nobel Prize winning economist Ronald Coase talked about this deficiency in his Nobel Lecture: [...]

Inflation Is (Still) Not About Consumer Prices

By |2019-04-10T12:36:19-05:00April 10th, 2019|Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

To most people, this inflation business seems pretty silly. There are those who argue that any inflation index whether the CPI, PCE Deflator or some other approach yet to be devised can accurately capture the concept. And they are absolutely right to question the enterprise. Most people feel inflation in the things they do most; [...]

ZIRP At 20; The ZLB Is A Trap, But Not The One Central Bankers Think It Is

By |2019-02-12T17:01:46-05:00February 12th, 2019|Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

Were they rushed, or were they late? Middle 2000’s consensus put academic opinion on the latter. The Bank of Japan had been Japan’s central bank since 1882, but it hadn’t been allowed to become a modern one until years into the 1990’s crisis. When speaking on the topic, Economists mostly mean independence and mandate rather [...]

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