The Wall Street Journal – BOJ Official Sees Inflation Over 1% in Next Fiscal Year Japan’s inflation rate will likely top 1% in the next fiscal year, a Bank of Japan 8301.JA -1.37% policy board member said Thursday, adding to expectations that the central bank will revise its price forecasts sharply higher at its policy… Continue reading The BOJ Is Optimistic Its Policy Will Work
Real Time Economics (WSJ Blog) – Are Central Banks Putting Their Independence at Risk? Over the past 20 or so years, central banks have won, cherished and defended their independence from elected politicians. If you want to keep inflation down, they said to the politicians, don’t meddle when we move interest rates up or down.… Continue reading Central Bank Independence
The Telegraph – Fed and Bank of Japan caused gold crash Bank of America says the gold crash since Friday has already discounted sales of the entire Cypriot, Portuguese and Greek gold reserves combined. “As we believe additional gold selling in the European periphery is highly unlikely, we find it hard to fully justify the… Continue reading More On Gold’s Crash
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Charts of the Week Topics Covered This Week Include: Mutual Fund Flows Update – Still No Rotation Into Stocks Gold’s Big Decline Gold ETFs Sold Before The Crash Updated Look At Gas Prices Citi Surprise Index Turns Negative A Look At Economic Expectations Update Of Central Bank Balance Sheets Investor Intelligence – No One Wants… Continue reading Charts of the Week
Next New Deal (Blog) – Researchers Finally Replicated Reinhart-Rogoff, and There Are Serious Problems In 2010, economists Carmen Reinhart and Kenneth Rogoff released a paper, “Growth in a Time of Debt.” Their “main result is that…median growth rates for countries with public debt over 90 percent of GDP are roughly one percent lower than otherwise;… Continue reading Questioning Reinhart & Rogoff
<Click on chart for larger image> Business Insider – The Citi Economic Surprise Index Just Went Negative… Lately economic data seems to be coming in week, and it’s gotten a lot of people talking about a “spring swoon” for the economy.Actually, there’s a bigger patter people are worried about, that every year we seem to… Continue reading Citi Surprise Index Turns Negative
The Financial Times – Martin Wolf: How central banks beat deflation The success of inflation targeting gives policy makers room to risk expansionary measures A final interesting conclusion emerges from the contrast between the performance of the US and Germany in the 1970s, which was when the Bundesbank cemented its reputation. It did not achieve… Continue reading Deflation
<Click on chart for larger image> MarketWatch.com – Gold’s fair value is $800 an ounce Commentary: What price is justified by gold’s fundamentals? Gold’s bear market is just beginning. That’s the depressing assessment from Claude Erb, a former commodities portfolio manager for Trust Company of the West, and co-author — with Campbell Harvey, a Duke… Continue reading More On Gold
Bloomberg.com – Gold Wipes $560 Billion From Central Banks as Equities Rally Investors are dumping gold funds at the fastest pace in two years in favor of equities, compounding a slump that has wiped $560 billion from the value of central bank reserves. Exchange-traded products linked to gold dropped $37.2 billion in 2013 as the… Continue reading Central Banks Lose $560 Billion On Gold’s Decline
Reuters.com – Fed doves stand by stimulus, though one has bright outlook A handful of Federal Reserve policy doves on Tuesday showed no sign they were prepared to dial down the central bank’s extraordinary accommodation any time soon, even though one gave a highly optimistic outlook that the economy will turn the corner next year.… Continue reading Federal Reserve Policy
The Financial Times – Forex chiefs hope for end of risk-on, risk-off trend After long months in the dark, currencies are coming back into the light. Investors have flocked back to the global foreign exchange market this year as trends have developed in key currencies, while talk of currency wars has put the Japanese yen,… Continue reading Risk-On, Risk-Off