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optimal control

The Dustbin Of Post-Panic History: QE Finally Joins The ‘Stimulus’ Bill

By |2014-07-09T15:52:49-04:00July 9th, 2014|Economy, Federal Reserve/Monetary Policy, Markets|

The FOMC policy statement confirms without much doubt that there has been a major shift in conditions and outlook. To reiterate in what cannot be overstated, the purpose of implementing QE was to create economic conditions that conformed to the historical understanding of economic growth. If not so much 1995, Bernanke’s FOMC wanted to return to at least 2005 and [...]

Economists v. Bonds

By |2014-05-30T09:47:05-04:00May 30th, 2014|Bonds, Economy, Federal Reserve/Monetary Policy, Markets, Stocks|

By now the bond market is really starting to annoy all the “right” people. The bear flattening that has taken place since operational taper commenced is a direct contradiction to those that implore dismissal of recent GDP (after pleading quite the opposite during the inventory build last year). Mainstream, orthodox economists have settled that Q1 is an aberration, a speed [...]

Low Inflation Taper Theory

By |2014-04-15T16:50:10-04:00April 15th, 2014|Economy, Federal Reserve/Monetary Policy, Markets|

There was considerable attention given to Janet Yellen’s appeal toward “optimal control” language in prior speeches and toward her confirmation. The idea is such that the newly committed 2% inflation target does not need to be a “rule.” Under optimal control, the FOMC may tolerate an inflation rate above that target if it allowed unemployment to decline at a quicker [...]

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