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ben bernanke

Taper *Without* Tantrum

By |2021-08-16T19:46:53-04:00August 16th, 2021|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

Whomever actually coined the term “taper”, using it in the context of Federal Reserve QE for the first time, it wasn’t actually Ben Bernanke. On May 22, 2013, the central bank’s Chairman sat in front of Congressman Kevin Brady and used the phrase “step down in our pace of purchases.” No good, at least from the perspective of a media-driven [...]

CPI’s At Fives Yet Treasury Auctions

By |2021-08-11T20:01:39-04:00August 11th, 2021|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

A momentous day, for sure, but one lost in what would turn out to be a seemingly endless sea of them. October 8, 2008, right in the thick of the world’s first global financial crisis (how could it have been global, surely not subprime mortgages?) the Federal Reserve took center stage; or tried to. Having bungled Lehman, botched AIG, and [...]

Inflation Review: How The ‘Best Jobs Market In Decades’ Couldn’t Deliver

By |2021-08-10T17:49:21-04:00August 10th, 2021|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

Money printing. Overheating. Going from an economy stuck in the mud to one rocketing ahead seemingly in the blink of an eye. Careless government officials steadfastly forecasting Goldilocks, surely whistling past the consumer price graveyard of stagflation misery.Long believed dead, that seventies Inflation Monster relit maybe by necessity but now on the loose lurking just beneath the surface, ready to [...]

Tapering The Truth

By |2021-07-28T17:13:38-04:00July 28th, 2021|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

Ceremony and ritual are not just important concepts for priming and keeping faith, they are absolute essentials. There’s a reason why cult leaders make themselves appear - at every instance - indispensable while at the same time keeping their masses busy with nonsense. Can’t ever permit thinking too much lest the house of cards crash downward at the first slight [...]

When You Aren’t Actually A Central Bank, Part 2: The Stubborn Deflation

By |2021-06-02T19:02:33-04:00June 2nd, 2021|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

Ever since March 2020, GFC2, Federal Reserve officials from Jay Powell on down have been busy patting themselves on the back for their splendid performance during last year’s big event. Again, market-of-last-resort. It would’ve been much worse, they claim, particularly given what happened in the Treasury market itself which we are supposed to believe QE bailed out just in the [...]

When You Aren’t Actually A Central Bank, Part 1: The Real Inflation

By |2021-06-02T18:50:46-04:00June 2nd, 2021|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

When Ben Bernanke stood up in front of Milton Friedman (it was his 90th birthday) back in November 2002, what he told the co-author of A Monetary History was that the monetary account contained within its pages had become settled, the officially-accepted version of events. What had made the Great Depression truly prolonged and horrific had been the long-ago Federal [...]

No Reason To Toss Out Low Rates In The Inflation Debate: The Repo Rat Rate Fallacy

By |2021-05-24T17:49:19-04:00May 24th, 2021|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

A dead rat would’ve easily explained the foul odor, though it wouldn’t have ended the matter. The smell was real, the cause still yet to be identified in the mainstream view. For the bond market, anyway, it was a process of discovery which began with an unexpected stench of something much bigger and more profound than any single or simple [...]

How Can Anyone In Their Right Mind Say This Much Inflation Is Transitory?

By |2021-05-12T17:33:03-04:00May 12th, 2021|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

Friday, July 14, 2000, was a bad day to be in Treasuries. The 10-year UST yield spiked 9 bps after the Census Bureau reported June 2000 retail sales growth had been nearly 10% year-over-year. That plus a similarly pleasant reading from the Federal Reserve for Industrial Production left bond traders rethinking their trades, a sudden burst of inflationary confidence which [...]

Global, Not Term Premiums: What Low Yields Really Say

By |2021-05-04T17:18:32-04:00May 4th, 2021|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

The standard explanation for low bond yields has been driven by – who else? – Ben Bernanke summing up the view from econometrics. Term premiums, he says, these made-up decomposition components which only allow for QE to save a tiny bit of its face. In other words, QE obviously didn’t lead to recovery, it sure didn’t create modest let alone [...]

What Is It About TIPS 5s Auctions? What Was It About *This* One?

By |2021-04-23T17:48:41-04:00April 23rd, 2021|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

Since we’re still on the topic of Treasury auctions, here’s another one to take a closer look at. Yesterday, Treasury sold $18 billion in 5-year TIPS – the inflation protected security (91282CCA7) – and though there were plenty of bids they came in at prices somewhat out of whack with the secondary market. This left two-thirds of the offering to [...]

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