As is usual at this time of year, the Chairman of the Federal Reserve Board and FOMC will gain inordinate attention due to the upcoming Jackson Hole assembly. Ben Bernanke in his stint made use of the PR to first introduce his ideas about coming intervention and manipulation. Janet Yellen may or may not do the same, but she will [...]
The central insight into the Minsky moment is really about saturation, as that point represents where any system can no longer sustain growing marginal inefficiency. In fact, it becomes so inefficient that its entire forward dependence is predicated on simply more debt being issued to pay off old debt. In terms of the economy, that means so much financial resources [...]
The Committee recognizes that low interest rates may provide incentives for some investors to “reach for yield,” and those actions could increase vulnerabilities in the financial system to adverse events. While prices of real estate, equities, and corporate bonds have risen appreciably and valuation metrics have increased, they remain generally in line with historical norms. In some sectors, such as [...]
For a moment last week it seemed like 2010 all over again. The euro crisis has been officially declared dead and buried, but Portugal’s rumblings on top of Greece’s renewed and further financial insecurity certainly made it seem otherwise. Only certain markets seem to care, however, as investor attention no longer seems transfixed by European dysfunction the way it was [...]
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