CNBC – All Eyes on Fed, but ‘Fiscal Cliff’ Looms Larger Markets expect the Fed to announce Wednesday that it will continue buying Treasurys, helping to keep rates low, but the course for near-term interest rates is more likely to be determined by the actions of politicians as “fiscal cliff” talks continue. The Fed is… Continue reading Next Steps For The Federal Reserve
<Click on chart for larger image> Comment The level of outstanding debt is now just $62 billion from the debt limit. What happens after that? As we detailed two weeks ago: [The debt] limit is expected to be reached [in about two weeks]. After that the Treasury will run down its cash balances and “borrow”… Continue reading The Debt Ceiling Nears
<Click on chart for larger image> Bloomberg Businessweek – Bernanke Critics Can’t Fight Bonds Showing No Inflation As Ben S. Bernanke considers whether to worry about inflation before adding to his record monetary stimulus today, he has the bond market on his side. Debt traders are anticipating prices will accelerate at the Federal Reserve’s target… Continue reading Is The Federal Reserve Getting This Right?
The Wall Street Journal – Inside the Risky Bets of Central Banks The central bankers typically stop short of formally coordinating their moves. Mr. Bernanke, Mr. Draghi and Bank of Japan head Masaaki Shirakawa are more focused on domestic challenges. Mr. Shirakawa has often warned others in Basel about the effectiveness of easy money policies,… Continue reading Inside The World Of Central Banks
The Economist – In search of “natural” velocity I HAD high hopes for the American economy after the Federal Reserve’s policy shake-up in September. It looked to me like a shift in framework that signalled increased tolerance for inflation, one that could potentially allow for a shift up in the trajectory of the recovery. Revisions… Continue reading The U.S. Economy
<Click on chart for larger image> MarketWatch.com – What could sabotage this stock market? Market will crash when rates start rising, right? What will it take to sabotage this bull market? Up until the last couple of weeks, it was widely thought that the fiscal cliff would do the trick. How could the stock market… Continue reading What Could Crash The Stock Market?
Reuters – Fed is expected to launch new bond buying program Fed is expected to launch new bond buying program to aid economy as ‘fiscal cliff’ looms With a nervous eye on the “fiscal cliff,” the Federal Reserve is expected this week to announce a new bond-buying plan to support the U.S. economy. The goal… Continue reading The Federal Reserve Meets Today
The Wall Street Journal – For Many Financial Advisers, Stocks Become a Hard Sell Since hitting a recession-driven low in March 2009, the Dow Jones Industrial Average has doubled in value. But many ordinary investors remain too fearful to join in the gains. After two stock collapses in one decade—2000-2002 and 2007-2009—along with scandals, the… Continue reading The Public Is Still Wary Of The Stock Market
Comment Most market watchers still subscribe to the belief that corporations hold record amounts of cash on their balance sheets just waiting to unleash into the economy. In March we pointed out how the Federal Reserve revised away nearly half a trillion dollars from corporate balances sheets. One of the more popular headlines from this… Continue reading The Myth Of Cash On The Sidelines Remains A Myth
MSN/Money – Bill Fleckenstein: A real cliff of incompetence, excuses As the stakes for our financial future ratchet higher, so do the rhetoric, political posturing and hypocrisy. And still the Federal Reserve and lax regulators escape blame. OK, everyone, buckle up. This is going to be a bumpy ride. First off, I would like to… Continue reading Fiscal Cliff Talk
The Financial Times – Edward Yardeni: US stock market rally deserves respect Everyone knows what will happen if the Democrats and the Republicans cannot cut a deal to avoid the fiscal cliff at the beginning of next year. The US economy is likely to fall into a short and shallow recession and the unemployment rate… Continue reading Stock Rally