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What Happens When The Federal Reserve Stops Buying?

September 17, 2013

The Financial Times – Sheila Bair: Tapering threatens a stormy outlook for America The storm season will soon be upon the US, both meteorologically and metaphorically. Continued – though slowing – economic growth suggests the Federal Reserve’s anticipated “tapering” of its aggressive bond-buying programme may not be far off, and gale-force winds are possible. We… Continue reading What Happens When The Federal Reserve Stops Buying?

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How To Stimulate Without Bond Purchases

September 17, 2013

The Wall Street Journal – Martin Feldstein: How to Create a Real Economic Stimulus The Fed’s monetary policy is no longer effective in stimulating demand. The near-zero interest-rate policy and aggressive quantitative easing, it has become increasingly clear, create dangerous risks to future stability…A successful growth and employment strategy would combine substantial reductions in the… Continue reading How To Stimulate Without Bond Purchases

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Newsclips

Former BIS Chief Economist Sees 2007 Redux

September 17, 2013

The Age – Worldwide credit excess ‘worse’ than pre-GFC The Swiss-based ‘bank of central banks’ says a hunt for yield is luring investors en masse into high-risk instruments, “a phenomenon reminiscent of exuberance prior to the global financial crisis”. This is happening just as the US Federal Reserve prepares to wind down stimulus and starts… Continue reading Former BIS Chief Economist Sees 2007 Redux

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Syria & The Brent/WTI Spread

September 17, 2013

<Click on chart for larger image> The Wall Street Journal – Syria Widening WTI-Brent Spread The conflict in Syria has driven a wedge between U.S. and European oil prices, as investors focus on the cushion that booming U.S. production provides against potential supply shocks elsewhere in the world. U.S. oil futures now are roughly $3.50… Continue reading Syria & The Brent/WTI Spread

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Newsclips

Yellen Is The Clear Favorite

September 17, 2013

The Wall Street Journal – Yellen Is Now Top Fed Hopeful Federal Reserve Vice Chairwoman Janet Yellen emerged as the front-runner to become the White House’s nominee to lead the central bank, a day after Lawrence Summers pulled out of the contest amid congressional resistance, according to people familiar with the matter. President Barack Obama… Continue reading Yellen Is The Clear Favorite

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J.P. Morgan

September 17, 2013

The Wall Street Journal – J.P. Morgan to Agree to ‘London Whale’ Fines J.P. Morgan Chase & Co. is expected to take a big step toward resolving the “London whale” trading fiasco, agreeing to pay at least $800 million in penalties and admit wrongdoing as part of a broad regulatory settlement over its handling of… Continue reading J.P. Morgan

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Newsclips

Spanish vs. Italian Yields

September 17, 2013

<Click on chart for larger image> MoneyBeat (WSJ Blog) – Viva Espana? Buy Spain, Sell Italy, says Morgan Stanley The jump in Italian bond yields above those of Spain last week was unusual. It has been the best part of two years since this has been the norm. But Spanish bonds are proving resilient, and… Continue reading Spanish vs. Italian Yields

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Another “Quote Processing Problem”

September 17, 2013

The Wall Street Journal – Stock-Options Trading Halted After Data Feed Problem U.S. options trading briefly ground to a halt Monday afternoon due to a problem with a benchmark data feed supplying options prices to traders, the latest technology breakdown to strike systems critical to U.S. trading operations. The market halted at about 1:40 p.m.… Continue reading Another “Quote Processing Problem”

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Cartoons

September 17, 2013

Newsclips

Summers Is Out! Here Comes Yellen

September 16, 2013

The Wall Street Journal – Summers Withdraws Name for Fed Chairmanship Former Treasury Secretary Calls Obama, Cites ‘Acrimonious’ Coming Confirmation Lawrence Summers, a former U.S. Treasury secretary, called President Barack Obama Sunday to say he is pulling out of the contest to succeed Ben Bernanke as chairman of the Federal Reserve.  “I have reluctantly concluded… Continue reading Summers Is Out! Here Comes Yellen

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Hilsenrath Finally Speaks!

September 16, 2013

The Wall Street Journal – Jon Hilsenrath: With Summers Withdrawal, Fed More Likely to Stay the Course Any Wind-Down of Central Bank’s Easy-Money Policies Should Be Gradual Lawrence Summers’s withdrawal from the running to become the next Federal Reserve chairman increases the likelihood of continuity in central-bank policy for the next few years—meaning any Fed… Continue reading Hilsenrath Finally Speaks!

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The FOMC Meeting

September 16, 2013

The Wall Street Journal – Sudeep Reddy: Fed to Meet Amid Trio of Threats to Economy Central Bank Faces Rising Rates, Turmoil Abroad, Budget Fight at Home Federal Reserve officials will face at least three sources of economic uncertainty when they gather Tuesday and Wednesday: rising U.S. interest rates, unsettling events abroad and another battle… Continue reading The FOMC Meeting