Comment After each FOMC meeting, we highlight a St. Louis Fed study on the rising complexity of the FOMC statement. As the charts below show, both the word count and the Flesch-Kincaid level have come down from their peaks of the past couple years (the Flesch-Kincaid Grade Level measures the number of years of school… Continue reading Understanding Fedspeak
[pageview class=”PDFViewer” url=”https://www.biancoresearch.com/bianco/wp-content/plugins/PDFViewer/plugin.php?id=270″] The Federal Reserve – Press Release (September 17, 2015) “Recent global economic and financial developments may restrain economic activity somewhat and are likely to put further downward pressure on inflation in the near term.” ..To support continued progress toward maximum employment and price stability, the Committee today reaffirmed its view that the… Continue reading Detailing The Fed
<Click on chart for larger image> CNBC – (September 17, 2015) – Oil falls ahead of Fed; OPEC sees $80 oil by 2020 Brent and U.S. crude futures fell on Thursday in volatile trading as investors awaited the Federal Reserve’s interest rate decision later in the day. The U.S. central bank will make an announcement… Continue reading Crude Oil Predictions
<Click on graphic for larger image> Bloomberg.com – It’s Party On in Credit Markets as Fed Stays at Zero for Longer Record pace of debt offerings seen continuing by investors BlackRock says borrowing costs still historically attractive The $11.8 trillion U.S. corporate borrowing binge will carry on. With the Federal Reserve leaving interest rates near… Continue reading Credit And China
<Click on graphic for larger image> The Economist – Buttonwood: Looking for the lifeboats Which investments work best when markets decline? MORE investors fear the American stockmarket is overvalued than at any moment since 2000, according to Robert Shiller of Yale University. Recent research by Deutsche Bank, meanwhile, suggests that government bonds are as expensive… Continue reading Falling Markets
The Economist – Flow dynamics Lots of money is escaping China’s porous capital controls That China’s foreign-exchange reserves have still fallen is evidence that even more money has left through other channels. Straight arithmetic implies some $600 billion in outflows. This, however, is a gross simplification. A strong dollar exaggerates the fall in reserves, by… Continue reading China Capital Flight
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<Click on chart for larger image> CNBC – Wall St now sees a Sept Fed rate hike: CNBC survey For the first time in the five-year history of the CNBC Fed Survey, a plurality of respondents forecast that the central bank will raise rates at the current meeting. Despite harrowing market volatility and rising anxiety… Continue reading The Fed Meeting Is Finally Here
<Click on chart for larger image> MoneyBeat (WSJ Blog) – The Pace of Rate Rises Matters to Markets Whether the Fed will raise short-term interest rates for the first time since 2006 has gotten nearly all of the attention. But perhaps as important as to whether the Fed tightens is the pace at which it… Continue reading The Pace Of Future Rate Hikes
MoneyBeat (WSJ Blog) – Why Some Hedge Funds Can’t Wait for Rates to Rise As investors fret about the impact of a possible hike in U.S. interest rates Thursday, for some hedge funds it can’t come soon enough. Hedge funds which trade bonds, stocks and currencies, have been deprived of trading opportunities in recent years… Continue reading Hedge Funds Want A Rate Hike
The Financial Times – China’s economic facts and fakes can be hard to tell apart What if China’s gross domestic product numbers were not all they were cracked up to be? Many economists have long suspected precisely that. For one thing, China’s data for GDP growth have been suspiciously smooth. While most economies are subject… Continue reading More Doubt On Chinese GDP Data
The Wall Street Journal – Hedge Fund Bridgewater Defends Its ‘Risk-Parity’ Strategy Firm led by investor Ray Dalio has had a rough summer and been the target of criticism The $70 billion All Weather fund is down nearly 5% for 2015 through mid-September, and its assets have dropped by more than $8 billion since the… Continue reading Defending Risk Parity Strategies