The Wall Street Journal – Why the Alarms About a Slight Rate Hike? Charles Evans, president of the Chicago Fed and a voting member of the board that determines rate policy, said last month that raising rates too soon would be a “catastrophe.” Former CEO of General Electric Jack Welch , during a Feb. 4… Continue reading Timing The First Rate Hike
Historical Market Performance Under Various Deflation/Inflation Scenarios In this study, we look at how the markets perform under various deflation/inflation scenarios. This study stretches as far back as 1801 and covers stocks, “real” stocks, long term interest rates, “real” long term interest rates, short term interest rates, and the CRB. We also compare returns before… Continue reading Historical Market Performance Under Various Deflation/Inflation Scenarios
<Click on chart for larger image> Reuters – Derailed CSX train in West Virginia hauled newer-model tank cars A CSX Corp oil train that derailed and erupted in flames in West Virginia on Monday was hauling newer model tank cars, not the older versions widely criticized for being prone to puncture, the firm said. All… Continue reading Transporting Crude By Rail
Bloomberg.com – Gary Shilling: Enjoy Cheap Oil, Fear the Deflation My last column explained the dangerous game of chicken Saudi Arabia is playing with other major oil producers, including U.S. frackers, to see who can withstand low oil prices the longest before slashing production. That price may be as low as $10 to $20 a… Continue reading Cheap Oil
The Wall Street Journal – Greece to Seek Extension on Loan Agreement Greece will seek an extension to its rescue deal from the rest of the eurozone Wednesday, two officials with knowledge of the situation said, signaling a shift in the standoff between Athens and its creditors. The extension of what the officials called Greece’s… Continue reading Greece Looks To Kick The Can Down The Road Yet Again
<Click on chart for larger image> Reuters – U.S. mortgage applications fall in latest week Applications for U.S. home mortgages fell last week as interest rates rose, an industry group said on Wednesday. The Mortgage Bankers Association said its seasonally adjusted index of mortgage application activity, which includes both refinancing and home purchase demand, fell… Continue reading The Mortgage Purchase Index
The Wall Street Journal – Central Banks and the Perils of Sub-Zero Conditions The monetary-policy anchor keeps on slipping. Until recently, it was broadly thought that zero was the final frontier beyond which central banks wouldn’t or couldn’t cut interest rates…How strange are zero and negative rates? Bond markets are proving that financial math works… Continue reading More On The Perils Of Accepting A Negative Rate Environment As The Norm
Real Time Economics (WSJ Blog) – Jon Hilsenrath: Fed Minutes Will Show How “Patient” Debate is Evolving Minutes of the Federal Reserve’s Jan. 27-28 policy meeting, to be released today, could reveal the contours of its discussion about forward guidance on interest rates. The Fed has been saying since December it will be patient before… Continue reading A Preview Of Today’s FOMC Minutes
The Financial Times – Unbalanced hopes for the world economy The global economy is an integrated system. Ignoring that reality is futile. At present, among the most important realities is the chronic weakness of private sector demand relative to potential incomes, in important economies. People who doubt this need only ask themselves how long-term nominal… Continue reading The Global Economy
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Factset – Earnings Insight for February 13, 2o15 During the first half of Q1 2015, analysts lowered earnings estimates for companies in the S&P 500 for the first quarter. The Q1 bottom-up EPS estimate (which is an aggregation of the estimates for all the companies in the index) dropped by 7.4% (to $27.31 from $29.48)… Continue reading An Earnings Update
The Telegraph (UK) – Greece rejects eurozone’s ‘absurd’ bailout offer as time runs out on talks Stand-off between Greece and its creditors looks no closer to ending as a second round of crisis talks between euro finance ministers began in Brussels The latest meeting between Greece and its international lenders over the debt-stricken country’s €172bn… Continue reading Greece Rejects