At his press conference earlier this week, Fed Chair Jerome Powell said the following… “The public should be confident that we will continue to do our work as we always have, focusing on using our tools to achieve our goals, and, really,...
In 1928 and 1929, the Fed raised interest rates for the purpose of curbing rampant speculation in stocks. At that time, investors could borrow as much as 90% of the stock price for their proposed investment. The banks were just as...
Investors keep looking to the Fed for supposed “forward guidance”. They are looking in the wrong place. Since mid-December, bond prices have declined another 5% and are currently at new 52-week lows. Here is an updated chart of U.S....
“I think instinctively – I can’t prove this, we’re going to learn about this empirically – but it seems to me that the neutral rate is probably higher than it was during the intra-crisis period. And so, rates will be higher.” (Jerome...
As rhetoric regarding trade tariffs increased prior to the election and, with that same rhetoric continuing post-election, the danger to free trade and a strong economy is heightened.
Bond prices collapsed nearly 3% post-election and are down 12% since mid-September. Whatever that tells us did not change because of election results. The action in bonds is contradictory to the prevailing assumptions of a melt-up in asset...
The latest salvo fired at the U.S. dollar by BRICS countries includes press reports about "creating an international precious metals exchange to ensure fair pricing and trade growth". Russia's finance minister, Anton Siluanov, announced...
As investors continue to gobble up stocks and the dollar prices of most assets continue to climb, it would appear that all is well. Concerns about weakening economic activity and recession have been moved to the back burner. Now, the focus...
Just a couple of weeks ago, on September 18th, the Fed announced a 50 basis points cut in interest rates. To be clear, the announced cut was generally expected and already discounted in the markets. Most markets had risen substantially...
HOW BAD CAN THINGS GET? Pretty damn bad. Which means that it will likely be much worse than most of us can imagine. Other than Covid and its forced shutdown of economic activity by governments world-wide, the most recent learning...