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QE Honesty

By |2016-03-11T12:55:51-05:00March 11th, 2016|Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

The Bank of Japan had previously “disappointed” last December when it failed to announced more “stimulus.” Setting aside who might actually have been frustrated by the lack of renewed distortions, the Japanese central bank did make some minor alterations to its QQE regime at that time. They expanded the list of eligible collateral and extended the average remaining maturity range [...]

Europe Proves The Placebo

By |2015-12-03T11:29:17-05:00December 3rd, 2015|Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

Language itself being imprecise, it is often difficult to assign terminology that exactly fits the circumstances or processes being described. So often convention thinks and writes and speaks of monetarisms as if they were drugs like speed or heroin; the efficacious inducement toward uninhibited recklessness. Thus, “markets” are the addicts that only perform in the presence of the intoxicant. This [...]

Quantity of Nothing But Lost Time

By |2015-10-22T14:33:54-04:00October 22nd, 2015|Economy, Federal Reserve/Monetary Policy, Markets|

While on the other side of the Pacific economists try to decipher what China has truly gotten itself into, over the Atlantic the Europeans are admitting that trillion is again not “enough.”  As I have written repeatedly, the adjectives attached to QE depend on the tense.  Ahead of time, peering into the unwritten future, QE “will be” powerful and able, [...]

Six Months Later, Cries For More QE Already

By |2015-10-06T15:30:48-04:00October 6th, 2015|Economy, Federal Reserve/Monetary Policy, Markets|

On September 28, Mark Haefele, Global CIO at UBS Wealth Management, wrote at CNBC.com there was much more to the central banking offerings than currently employed. The implication, obviously, was a reassuring call to not heed any darkening outlook. Blaming that upon “overanalyzed data”, Mr. Haefele insisted that investors were becoming far too pessimistic given the potential monetarism yet untapped. [...]

QE One More Time; All Risk, No Reward

By |2015-09-02T17:23:26-04:00September 2nd, 2015|Economy, Federal Reserve/Monetary Policy, Markets|

The re-crash of oil prices during the recent “dollar” wave/run were hard on almost everyone involved, economically and otherwise, but perhaps not more so than the ECB and its QE proponents. Despite being attributed with every minor upward move that could plausibly be assigned, for all the hype there has been very little actual movement anywhere of significance. The virtuous [...]

More QE Non-neutrality

By |2015-07-29T16:35:24-04:00July 29th, 2015|Economy, Federal Reserve/Monetary Policy, Markets|

The simple narrative about QE is drawn from what is believed a simple process. The central bank buys bonds and by doing so it is simply assumed to be an “extra” bid on bond prices; therefore interest rates fall in whatever issue is being targeted by QE. Even in the US, QE has had trouble with that simple relationship. Instead [...]

Still The Same Greece, Still The Same Math

By |2015-07-08T12:58:06-04:00July 8th, 2015|Economy, Federal Reserve/Monetary Policy, Markets|

In April 2008, Nassim Taleb was becoming a household name criticizing the quant dominance in finance. Bear Stearns had just failed and the entire edifice of mathematical order was still breaking down, as the last bastions of credit default swap “supply”, the monoline insurers, were still rumored to be heading for insolvency (while the nightly news focused on whether that [...]

ECB, Monetarism and a Greek Half-Decade

By |2015-06-29T11:20:42-04:00June 29th, 2015|Economy, Federal Reserve/Monetary Policy, Markets|

Greece really should not matter, at all, outside of the tragic plight of the Greeks themselves. You’ll see that message echoed particularly inside the US where the status quo takes a contradictory turn toward reasonableness in order to justify further what isn’t. This is all about asset prices and how they have been so skewed almost everywhere that when one [...]

Santa Claus in Sweden

By |2015-06-25T12:00:34-04:00June 25th, 2015|Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

Just a few weeks ago the Swedish central bank, Riksbank, was being lauded for its courage and action in finally embracing QE as the ECB had done. The deflation problem in Sweden had been, so it is asserted, seemingly intractable and thus forcing the monetary hand once more. Riksbank has never been shy about fine-tuning here and there, so it [...]

Liquidity And Manipulated Prices Are Not An Economy And Never Will Be

By |2015-06-19T10:40:44-04:00June 19th, 2015|Bonds, Economy, Federal Reserve/Monetary Policy, Markets|

The Greek drama seems to have reached somewhat of a boundary, with deadlines and credit assistance drawing toward maximums. If this seems more than a little déjà vu that’s because it is an almost exact replay of 2012; all that is missing at this point is another default (debt swap or however it shall be classified). Greek banks have been [...]

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