MoneyBeat (WSJ Blog) – Federal Reserve Could Add to Toolkit for Raising Rates Federal Reserve officials discussed at their October meeting a new tool to use when it comes time for them to start raising short-term interest rates from near zero, according to minutes of the meeting released Wednesday…The Fed plans to use as its… Continue reading A New Tool In The Fed’s Toolkit?
Stone Street Advisors – Where’s the Slack? This June, the Fed’s most reactionary member, and noted hand talking enthusiast, James Bullard gave what I found to be one of the most reasonable presentation on FOMC policy in years. It was titled ‘How Far Is the FOMC from Its Goals?’ and if you have not seen… Continue reading Judging The Fed On Its Dual Mandate
The Wall Street Journal – Soros Puts His Money on Gross Before Bill Gross was fully settled in at his new firm, Janus Capital Group Inc., he received an unlikely visit from the chief investment officer of famed investor George Soros ’s firm, according to a person familiar with the meeting. That encounter in Newport… Continue reading Soros Bets On Gross
Piera.co.uk – How important is a manager’s experience in fund selection? An electronic voting system enabled the audience of UK-based financial advisers to express their thoughts on the matter and the overriding view turned out to be that, yes, fund manager tenure was a very important consideration. It also emerged that the audience members themselves… Continue reading The Expected Half-Life Of A Fund Manager
Real Time Economics – Jon Hilsenrath: FED STAFF WHISPERING CAUTION IN OFFICIALS’ EARS While Federal Reserve officials sent a steady-as-she-goes message at their Oct. 28-29 policy meeting, the staff economists advising them were focused on downside risks to the economy. The staff nudged down its projection for growth in economic output over the medium term… Continue reading The FOMC Minutes Show That The Fed Focused On Inflation
<Click on chart for larger image> Real Time Economics – U.S. Debt Held by Foreigners Hits Record $6.07 Trillion Foreign holdings of U.S. Treasury securities hit a record high $6.07 trillion in August, up nearly $70 billion from July, as the dollar began its climb to five-year highs and the U.S. recovery showed signs of… Continue reading China & Japan Sell U.S. Treasuries
The Economist – About that debt IT HAS been a tumultuous couple of weeks for Japanese policy makers. First, the Bank of Japan dramatically scaled up its quantitative easing programme in response to weak growth and inflation figures. Then, new data revealed that the Japanese economy shrank at a 1.6% annual pace in the third… Continue reading Where Does Japan Go From Here?
The Financial Times – No need for radical asset mix adjustment US pullback was a correction, not a harbinger of recession and bear market The lesson learnt after the roller-coaster ride of the past six weeks is that even in bull markets, equity prices do not move straight up any more than they move straight… Continue reading More On The October Stock Market Correction
Bloomberg – Yellen Gets That Sinking Feeling Greenspan Once Knew Alan Greenspan couldn’t control long-term interest rates a decade ago, and bond investors are betting Janet Yellen’s luck will be no better. When then-Federal Reserve Chairman Greenspan raised the benchmark overnight rate from 2004 to 2006, long-term borrowing costs failed to increase, thwarting his attempts… Continue reading Greenspan And Yellen
The Wall Street Journal – Recessions Leave Permanent Scars, Fed Research Finds Harsh downturns tend to permanently lower the economy’s growth potential, according to new research from the Federal Reserve that upends conventional theory and suggests early and aggressive policy action is advisable when dealing with recessions. “Output typically does not return to pre-crisis trend… Continue reading How Recessions Permanently Hurt The Economy
Bloomberg View – Fed and Markets More Co-Dependent Than Ever For their part, markets really like having the Fed serve in the role as a best friend for asset prices. Absent a global economic or geopolitical shock or a domestic political one, this will continue to give confidence to traders to take on greater risks… Continue reading Co-Dependency: The Fed & The Markets