Research Affiliates – The Impact of Tapering on Risky Assets The U.S. Federal Reserve surprised the markets by announcing its decision to postpone reducing the purchase of Treasury and agency mortgage-back securities. The Board of Governors said the central bank will continue buying $45 billion in Treasury bonds and $40 billion in agency MBS every… Continue reading The Impact Of Tapering …If It Ever Happens
The Atlantic – How Bad Data Warped Everything We Thought We Knew About the Jobs Recovery The real legacy of the Lehman collapse wasn’t an economic meltdown. (That would have happened anyway.) It was three years of wrong information about the economy. Okay, but what are seasonal adjustments, and how do they work? Well, you… Continue reading Bad Data And The Jobs Market
MoneyBeat – Questions Swirl About High-Speed Trading and Last Week’s Fed Announcement As if the Federal Reserve’s no-taper decision wasn’t complicated enough, speculation that some traders may’ve gotten word of the decision earlier than they were supposed to is gaining traction. Eric Hunsader, founder of Nanex, a Chicago firm that studies and distributes stock-market data,… Continue reading The Great Fed Robbery
The Financial Times – JPMorgan eyes $4bn ‘pay for peace’ deal JPMorgan Chase is in talks to pay over $4bn in a “pay for peace” deal with US authorities to settle a host of allegations of wrongdoing in the mortgage securities market, according to people familiar with the matter. The bank is pushing for one… Continue reading A Look At Next Week’s JP Morgan Fine
MarketWatch.com – 3 things bigger than the taper on Wall Street Commentary: Investors could be in for a rough ride before year end Will all this talk about the “taper” ever end? How about just taper off? If you’re an investor in stocks or bonds or have a loan with a variable interest rate, you’re… Continue reading A Rough Quarter Ahead?
Reuters.com – Fed’s Bullard: Decision not to taper ‘enhanced’ Fed’s credibility The Federal Reserve’s surprise decision to maintain its monthly bond purchases improved rather than damaged the U.S. central bank’s credibility, a top Fed official said on Friday. “I think it enhanced our credibility in the sense that it showed we really are paying attention… Continue reading Federal Reserve Officials Can’t Even Agree On Their Own Credibility
FT Alphaville (FT Blog) – The greatest trick the Fed ever pulled… The Fed’s Fixed Rate Full-Allotment Reverse Repo (FRFARRP) facility kicked off in trial mode on Monday, and as pointed out by Manmohan Singh on FT Alphaville earlier on Monday, the facility may prove just as significant — if not more significant — than… Continue reading The Fed’s Repo Facility
Zero Hedge (Blog) – BNP Warns Only 10% Chance That Abenomics “Ends Well” Japan’s core CPI (which excludes perishables) surged 0.7% y/y in July, but the upturn is largely due to higher prices for energy that reflect rising import prices due the yen’s weakness. Despite global exuberance at Abe’s “progress”, BNP notes that there are… Continue reading Is Abenomics Working?
Real Times Economics (WSJ Blog) – The Key to Forward Guidance? Don’t Give It, Stan Fischer Says Critics of the U.S. Federal Reserve say it did a poor job this summer in communicating plans to wind down a $85-million-a-month bond-purchase program. he lesson, according to Stanley Fischer, the former head of the Bank of Israel,… Continue reading The Problem With Forward Guidance
The Financial Times – Pierre Andurand turns more bullish on US oil One of this year’s most successful commodity hedge fund managers has become more bullish on the outlook for US oil prices. Pierre Andurand’s eponymous hedge fund returned 44 per cent by the end of July, according to HSBC data, after he correctly forecast… Continue reading Could WTI Prices Rise Above Brent Prices?
The Wall Street Journal – U.S. Readies Civil Suit Against J.P. Morgan on Mortgages Flurry of Negotiations Take Place Justice Department officials are preparing to file a civil lawsuit against J.P. Morgan Chase & Co. over the bank’s handling of residential mortgage-backed securities before the financial crisis, according to people familiar with the matter. Government… Continue reading This Week’s Installment In JP Morgan Fines And Lawlessness