The Wall Street Journal – Ex-Federal Reserve Governor Jeremy Stein Heads for Hedge Fund A former Federal Reserve governor who expressed concern that central bank policies could spark financial instability is headed for the world of hedge funds. Jeremy Stein signed up as a paid consultant to BlueMountain Capital Management, the more than $20 billion… Continue reading Jeremy Stein Now At A Hedge Fund
MoneyBeat – How Long Can Central Bankers Ignore Bubbles? There is clearly a tension between the needs of underlying economies for further monetary support and overblown financial markets. Of course inflating asset prices through quantitative easing was part of the deal. Central banks intended it to generate wealth effects and spur consumption, credit creation and… Continue reading Central Banks Ignore Bubbles
<Click on chart for larger image> Bloomberg Business – Buyback Blackout Leaves U.S. Stocks on Own Prior to Earnings Buybacks, which reached a monthly record in February and have surged so much they make up about 2 percent of daily volume, are customarily suspended during the five weeks before companies report quarterly results, according to… Continue reading Buybacks
The Financial Times – Scott Minerd: QE will lower living standards long term Prospect of improvement in growth is largely a monetary illusion In the long run, however, classical economics would tell us that the pricing distortions created by the current global regimes of QE will lead to a suboptimal allocation of capital and investment,… Continue reading Another QE Skpetic
The Wall Street Journal – The Fed’s Miserable Mystery Tour The American public can’t help but view Federal Reserve officials as glass-half-empty types. While people owning stocks or planning to borrow money certainly aren’t rooting for an imminent interest-rate increase, the reason some officials have cited for caution must seem odd. The most prominent concern… Continue reading Why The Public Hates The Federal Reserve
Bloomberg View – William Pesek: Give China a Reserve Currency As former U.S. Secretary of State Colin Powell famously advised, China favors “overwhelming force” in its campaigns, military or otherwise. Most recently, in a direct challenge to the global economic architecture established by the U.S. and its allies after World War II, Beijing has pledged… Continue reading The Yuan As A Reserve Currency
Real Time Economics (WSJ Blog) – Jon Hilsenrath: Disappearing Hawks and Other Reasons for Fed Forecast Shift Central bank watchers have spent much of the past few days taking measure of the Federal Reserve’s shifting forecasts for the economy and interest rates. At their meeting last week, Fed officials reduced their estimate of the long-run… Continue reading Explaining The Fed’s Change In Forecasts
Bloomberg.com – Treasury ETF Loses Record $6.1 Billion by Betting on Rate Rise An exchange-traded fund that profits when interest rates rise has burned through more investor cash than any other in the industry. The ProShares UltraShort 20+ Year Treasury fund has lost $6.1 billion of investor money since its inception in 2008, more than… Continue reading Betting On Higher Rates
<Click on chart for larger image> San Francisco Gate – Imports plunged at West Coast ports amid labor dispute Months of congestion at West Coast ports — the result of a labor dispute and other logistical problems — led to major shifts in U.S. trade patterns. Import data for the first two months of this… Continue reading Examining The Port Slowdown’s Effect On GDP
The Financial Times – Patience is best strategy in low-yield world Borrowing euro or yen has probably never been cheaper. As a result, carry trades in higher-yielding emerging markets, financed at bargain rates in these weak currencies, should be a feature of the investment landscape. But few managers are putting on such trades these days.… Continue reading Carry Trade Risks Outweigh Rewards
Bloomberg Business – Draghi Rejects Lawmaker Accusation ECB Is Blackmailing Greece Mario Draghi pushed back against an accusation that the European Central Bank is blackmailing Greece and compounding the pressure on the country. “Let me disagree with you about everything you said,” Draghi remarked in the European Parliament on Monday. He was responding to comments… Continue reading The Tense Relationship Between The ECB & Greece