The Financial Times – Mohamed El-Erian: Yellen shows Fed will remain markets’ best friend Janet Yellen’s confirmation hearing last week reaffirmed that the Federal Reserve remains risk markets’ best friend – and not by choice but by necessity…Ms Yellen’s key views may be summed up in five points: Concern at the human toll of continued… Continue reading QE & Risk Markets
Real Time Economics (WSJ Blog) – Bernanke Pushes Back on Idea QE Hurts Main Street Some critics charge that the Federal Reserve’s signature $85 billion-per-month bond-buying program has been great for Wall Street but hasn’t done much for Main Street. Fed chief Ben Bernanke doesn’t agree with such assessments. “I hate to shock you but… Continue reading Wall Street vs. Main Street
MoneyBeat (WSJ Blog) – S&P 500 Celebrates One-Year Above 200-Day Moving Average The market’s uptrend is getting a little long in the tooth, but not enough to worry chart watchers. Today marks one year that the S&P 500 has been above its 200-day moving average line, which MKM Partners chief market technician Jonathan Krinsky said… Continue reading Technical Market Minutiae
The NY Post – John Crudele: Census ‘faked’ 2012 election jobs report In the home stretch of the 2012 presidential campaign, from August to September, the unemployment rate fell sharply — raising eyebrows from Wall Street to Washington. The decline — from 8.1 percent in August to 7.8 percent in September — might not have… Continue reading Jack Welch May Have Been On To Something Regarding The Jobs Report
The Financial Times – Why the future looks sluggish Lawrence Summers has poured gallons of icy water on any remaining optimists. Speaking on a panel at the International Monetary Fund’s annual research conference, the former US Treasury secretary suggested that there could be no easy return to pre-crisis normality in high-income economies. Instead, he sketched… Continue reading Sub-Par Economic Growth
Bloomberg.com – Fed Ponders How to Temper Tapering Without Rate Increase The Fed’s failure so far to convince investors that tapering on its own doesn’t constitute a tightening of policy creates the risk of more market volatility as the central bank communicates about tools it’s never used. “Now, this is challenging: We’re in unprecedented circumstances,… Continue reading The Federal Reserve’s Dilemma
The Financial Times – Mohamed El-Erian: Yellen shows Fed will remain markets’ best friend But higher growth is needed to validate prices of risk assets Looking forward, investors would be well advised to remember Ms Yellen’s correct observation that robust growth is the best way to allow for the orderly normalisation of monetary policy. Indeed,… Continue reading The Federal Reserve Will Continue To Support The Markets
<Click on chart for larger image> Bloomberg Businessweek – Foreign Buying of U.S. Portfolio Assets Gains on Asia Demand Today’s report showed China’s holdings swelled $25.7 billion to $1.29 trillion in September. Japan increased its share by $29 billion to $1.18 trillion, the figures showed. The Treasury’s monthly report on the cross-border flow of portfolio… Continue reading China & Japan Increase Their U.S. Treasury Holdings
The Financial Times – Riskier loan slices hit record levels Riskier “covenant-lite” loans, which offer fewer protections to lenders, are making up record levels of the debt packages sold to investors amid resurgent lending markets and a thirst for higher returns.Managers of collateralised loan obligations, which package up corporate loans and slice them into different… Continue reading Credit Market Bubble: Cov-Lite Loans Hit New Record
Reuters.com – Fed’s Dudley ‘hopeful’ on recovery; Plosser calls for capping QE Top Federal Reserve officials from opposite sides of the policy spectrum pointed to improvement in the U.S. economy on Monday, adding more weight to the notion that the central bank is getting close to reducing the pace of its monthly asset purchases. William… Continue reading Plosser Wants To Cap QE
The Wall Street Journal – OECD Warns of U.S. Threat to Global Recovery The report marks a significant shift in the OECD’s focus of concern, which in recent years has been centered on the euro zone’s attempts to tackle its fiscal and banking crises. While the OECD remains worried about the euro zone’s frailties, the… Continue reading Uncertainty In The U.S. Is A Risk To The Global Economy