<Click on chart for larger image> The Financial Times – Report points to new Fed policing tools The central bank is playing a much larger role in a key shadow banking market, which it could use to better govern this opaque area of the financial system. The report from the Office of Financial Research, part… Continue reading The Fed’s Reverse Repo Program
USA Today – Market’s correction-free run tops 1,000 days The record-setting Wall Street bull refuses to succumb to correction talk. If you think it’s been a long time since the Standard & Poor’s 500-stock index suffered an official correction, or 10% drop, you’re on to something. Wall Street’s correction-free run is now 1,000 days long… Continue reading The Correction-less Rally
The Wall Street Journal – Making Money With the Fed: Don’t Get Mad, Get Even In these postcrisis days, it is taken for granted that the Federal Reserve exerts a powerful influence on the stock market. But that influence may be getting exercised at far more regular intervals than either investors or the Fed itself… Continue reading Gaming The Fed
The Wall Street Journal – John H Cochrane: The Failure of Macroeconomics When models don’t yield the spending policies they want, some Keynesians abandon models—but not the spending. Broadly speaking, is the slump a lack of “demand,” which monetary or fiscal stimulus can address, or one of structural sand-in-the gears that stimulus won’t fix? The… Continue reading New Keynesian Models
The Financial Times – Big US dividend payers prosper as equities soar Investors’ marked preference for dividends shows just how many are engaged in a long-running hunt for yield against a backdrop of meagre bond returns. And with good reason. Sticking with stable companies that keep increasing their payouts has been a solid strategy given… Continue reading Dividend-Paying Stocks
Bloomberg.com – BOE’s Cunliffe Says Low Rates Raise Risk of Debt Buildup Bank of England Deputy Governor Jon Cunliffe said low borrowing costs may hide the real cost of Britons’ mortgage burden and increase the risk of a buildup in household debt that could threaten financial stability. “The main risk we see arising from the… Continue reading The BOE Points To Low Rate Environment As One Reason For Financial Instability
Real Time Economics (WSJ Blog) – GDP is Down, But What Do Payrolls Say About A New Recession Risk? U.S. gross domestic product shrank by 2.9% in the first quarter of 2014, by far the worst quarter since the recovery began in mid-2009. But GDP is only one indicator to monitor if the U.S. is… Continue reading Watching Jobs As A Barometer For A Recession
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Charts of the Week This week we assembled a collection of over 70 of our favorite long-term charts. Please enjoy. Topics Covered This Week Include: Long Term Interest Rates Back To 1790 Short Term Interest Rates Back to 1831 Long Term and Short Term Interest Rates Back to 1831 “Real” Long Term Interest Rates Back… Continue reading Charts of the Week
Bloomberg.com – ADP Says Companies in U.S. Add Most Workers Since 2012 Employment at companies climbed in June by the most since November 2012, a sign the U.S. job market is strengthening along with demand, a private payrolls report showed today. The 281,000 surge exceeded the most optimistic forecast in a Bloomberg survey and followed… Continue reading Previewing Thursday’s Payroll Report
Cleveland Federal Reserve – Why Inflation Is Very Low, and Why It Matters Since the most recent financial crisis, the story has been different. While inflation typically falls in the immediate aftermath of a recession, it usually rises during the ensuing economic recovery (figure 1). This time around, inflation has remained at very low levels… Continue reading Why Low Inflation Matters
The Wall Street Journal – HILSENRATH’S TAKE: YELLEN AND LAGARDE TAKE STOCK OF LESSONS FROM CRISES PAST The two most powerful women in finance gather Wednesday for an International Monetary Fund address in Washington D.C. on financial stability. Federal Reserve chairwoman Janet Yellen will be speaking in honor of Michel Camdessus, the Frenchman who ran… Continue reading Yellen Speaks Today