Brookings.edu – Ben Bernanke: Should monetary policy take into account risks to financial stability? Let there be no mistake: In light of our recent experience, threats to financial stability must be taken extremely seriously. However, as a means of addressing those threats, monetary policy is far from ideal. First, it is a blunt tool. Because… Continue reading Bernanke Speaks
The Financial Times – Wall Street wary of ‘audit the Fed’ campaign Wall Street banks are recoiling at a Republican push to subject the Federal Reserve to greater congressional oversight as bankers fear the consequences of politicians — including their own allies — meddling in monetary policy. A campaign to “audit the Fed” has been… Continue reading More On “Audit The Fed”
The Financial Times – Martin Wolf: China will struggle to keep its momentum As the economy slows, the demand for investment is likely to fall more than proportionately If the Chinese economy is to shift into its new normal on a stable and sustainable basis, it has to avoid any such collapse. To achieve this… Continue reading China
<Click on chart for larger image> The Financial Times – Currency wars: is the US the new victim? Dollar strength reflects global policy divergence, not direct intervention What goes around comes around. In September 2010, Guido Mantega, then Brazil’s finance minister, popularised the term “currency wars”. He claimed governments around the world — led by… Continue reading Monetary Policy And The Dollar
Facebook – Mike Lee Behold my display of the 2013 Federal Register. It contains over 80,000 pages of new rules, regulations, and notices all written and passed by unelected bureaucrats. The small stack of papers on top of the display are the laws passed by elected members of Congress and signed into law by the… Continue reading Government Gridlock & The Markets
<Click on chart for larger image> The Wall Street Journal – Fewer Oil Trains Ply America’s Rails The growth in oil-train shipments fueled by the U.S. energy boom has stalled in recent months, dampened by safety problems and low crude prices. The number of train cars carrying crude and other petroleum products peaked last fall,… Continue reading Crude By Rail Slows
The Financial Times – Bill Dudley says US economy hit by ‘temporary factors’ The US economy probably grew by a weaker than expected 1 per cent in the first quarter of this year but growth should accelerate in the months to come as “temporary factors” dissipate, a senior Fed policy maker said on Monday. Friday’s… Continue reading Dudley Blames The Weather
The Financial Times – Lex: Oil price: needs a new gear Historic bear markets have lasted, on average, two decades; expect more pain ahead After flowing downhill throughout the second half of last year, oil prices have settled at about $50 this year. Might the worst be over? Not yet. Credit Suisse believes that between… Continue reading Historical Perspective On Oil’s Bear Market
The Financial Times – Fast forex moves raise liquidity worries For a market that trades a notional average of $5.3tn a day, foreign exchange is currently bedevilled by a perplexing problem: what has happened to market liquidity? In recent months a series of dramatic and unforeseen intraday fluctuations — even in popular and widely traded… Continue reading Forex Market Liquidity Concerns
Real Time Economics (WSJ Blog) – Greg Ip: On Secular Stagnation, Ben Bernanke’s Theory Meets Larry Summers’s Evidence Two of the biggest names in macroeconomics met on the battlefield of the blogosphere last week. Former Federal Reserve Chairman Ben Bernanke and former Treasury Secretary Larry Summers were debating why interest rates are so low. For… Continue reading More On Bernanke vs. Summers
<Click on chart for larger image> Bloomberg.com – World Economy Ready to Bounce After Sluggish Opening to 2015 It’s deja vu time all over again for the world economy. That means you can expect output to pick up after a disappointingly sluggish first quarter, say economists at JPMorgan Chase & Co. and Capital Economics Ltd.… Continue reading Hope Springs Eternal For World Growth