The Telegraph – Central bank prophet fears QE warfare pushing world financial system out of control Former BIS chief economist warns that QE in Europe is doomed to failure and may draw the region into deeper difficulties “QE is not going to help at all. Europe has far greater reliance than the US on small… Continue reading Will More QE End The World?
<Click on chart for larger image> Bloomberg Businessweek – Is Dollar Next? Investors Reassess After Swiss Shock There are already signs the U.S. central bank may be pulling back from a possible rate increase around midyear. Fed officials urged “patience” on monetary policy at their December meeting, noting risks to the economy from lower oil… Continue reading The Dollar
<Click on chart for larger image> Forbes – How Wrong Could GDP Forecasts Be? Undeterred by such comments, investors yearn for a tipoff on how the economy will perform. Their confidence in gross domestic product forecasts, however, overlooks the fact that economists’ computer models radically simplify the highly complex U.S. economy. In the aforementioned Barron’s… Continue reading Is Forecasting GDP Really That Difficult?
<Click on chart for larger image> Politico – Obama’s Gallup approval rating is lowest yet in year 6 President Barack Obama had his lowest-ever average approval rating during his sixth year in office, Gallup found in an analysis of its daily tracking polls over the past year. Obama’s Gallup approval rating averaged 42.6 percent during… Continue reading Obama’s Approval Rating Slips
The Financial Times – How to solve the fixed income liquidity problem Regulatory change means solutions lie in asset management sector, writes Gene Frieda It should be clear from experiences both recently and in May 2013 that tantrums can turn violent, and that the ensuing collateral damage to confidence and indeed corporate and consumer financing… Continue reading Fixing The Liquidity Problem In Fixed Income
Bloomberg.com – Junk Replaces Government Debt as Most-Disdained: Bloomberg Poll Junk bonds have supplanted sovereign debt as the asset investors would most like to bet against amid concern that a slowdown in global economic expansion will make it harder for the world’s neediest borrowers to meet their obligations. With both the International Monetary Fund and… Continue reading Junk Bonds
<Click on graphic for larger image> The Financial Times – The Great China FX Outflow Net errors and omissions (NEO) in China’s Balance of Payments have turned negative and likely represent accelerating capital outflow. From Goldman: Compared to global peers, we find that the NEO pattern in China has been amongst the most persistent in… Continue reading China’s FX Outflow
<Click on graphic for larger image> The Wall Street Journal – Corporate-Bond Investors Anticipate Giant Deals Companies Rush to Sell Debt While Rates Are Low Investors and bankers are bracing for another wave of giant corporate-debt sales this year, as companies rush to tap abundant demand while rates stay low. In the coming months, some… Continue reading Corporate Bond Sales Start 2015 Off Strong
<Click on chart for larger image> The Financial Times – Gold rally due as central banks add risk Incompetence and monetary dysfunction make gold look attractive For their part, investors have been warned. So many leveraged positions in the markets are predicated on predictable central bank behaviour and believable central bank assurances about their future… Continue reading Is Gold Due For A Rally?
<Click on chart for larger image> Seeking Alpha – China And Japan Treasury Holdings Japan’s holdings rose to a record $1.24 trillion in November. This is a $56 bln increase from November 2013. On the other hand, China reduced its Treasury holdings for the third consecutive month in November to $1.25 trillion. From November 2013,… Continue reading China Reduces U.S. Treasury Holdings As Japan’s U.S. Treasury Holdings Increase
The Wall Street Journal – HILSENRATH’S TAKE: JAPAN’S CAUTIONARY TALE AS FED CONTEMPLATES RATE INCREASES After five years with interest rates pinned near zero, the central bank was finally ready to exit its emergency monetary policy. It had wound down its quantitative easing program and backed away from promises to keep interest rates low. It… Continue reading The Federal Reserve’s Nightmare Scenario