The Financial Times – Lex: US government bonds Want to reduce the interest rate on your debt? If you are the US government just borrow more and lenders will flock. “Borrow more to pay less” is still working brilliantly for the US government. The Federal Reserve is now pitching in, but not primarily because yields… Continue reading The Bond Bubble
Interfluidity.com – Steve Randy Waldman: Monetary policy for the 21st century Twentieth Century monetary policy can be understood very simply. One can imagine that, prior to the 1980s, the marginal unit of CPI was purchased from wages. That made managing inflation difficult. In order to suppress the price level, central bankers had to reduce the… Continue reading Monetary Policy
The New York Federal Reserve – New York Fed Releases New Report, Web Page on Household Credit Additionally, for the first time since early 2006, the share of total household debt in some stage of delinquency declined, from 11.9 percent to 11.2 percent. However, the number of people with a new bankruptcy noted on their… Continue reading The New York Federal Reserve Begins Releasing A New Quarterly Report On Household Credit Conditions
Pimco.com – When Unconventional Becomes Conventional Central bankers like to conduct monetary policy by counter-cyclically altering a short-term policy rate. They also like to do so via guidance from some variant of a Taylor Rule, which posits how much the policy rate should change given where inflation and unemployment stand relative to explicit or implicit… Continue reading Paul McCulley Speaks
Bloomberg Businessweek – BOE Voted 8-1 on Stimulus in Third Loss for Sentance Bank of England policy makers considered arguments for expanding or withdrawing emergency stimulus this month before overruling Andrew Sentance’s third call for an interest-rate increase. The Monetary Policy Committee, led by Governor Mervyn King, voted 8-1 to keep the benchmark rate at… Continue reading The BOE Decides Not To Increase The Level Of QE
Real Time Economics (WSJ Blog) – ‘Economic Benefits’ From Tighter Bank Regulation The global economy won’t suffer if banks are forced to adopt tighter standards on capital and liquidity, the Financial Stability Board and Basel Committee for Banking Supervision said in a joint statement Wednesday. The statement summarizes an interim report on the long-term effects… Continue reading ‘Benefits’ From Tighter Bank Regulation
The Financial Times – Earnings good, outlook upbeat … markets gloomy Earnings were great, relative to what analysts were forecasting, and many company outlooks for the next quarter are upbeat. Yet the mood in the stock market remains fragile and glum. With about 90 per cent of the companies in the S&P 500 having reported… Continue reading Surprise! … Companies Report Strong Earnings And Have A Positive Outlook
The Washington Post – Neil Irwin: Federal Reserve’s shift in policy doesn’t change its basic outlook After the Federal Reserve’s policy meeting last week, the drumbeat on Wall Street and among some economists for bold new steps to strengthen the economy got louder. Don’t hold your breath. The Fed’s move last week to make its… Continue reading The Federal Reserve
None Today
The Wall Street Journal – China Sold More Treasurys, but Market Rallies On Demand for U.S. government debt is so strong lately that not even an apparent slowdown in China’s appetite for it can stop the rally in bonds…Not long ago, such a report might have caused a selloff in Treasury bonds. China has since… Continue reading What U.S. Assets Are Being Sold By China?
The Wall Street Journal – The Future of Housing Finance Today the Obama administration will begin a discussion on how to overhaul our nationalized housing finance system. Moderated by Treasury Secretary Timothy Geithner and Shaun Donovan, secretary of the Department of Housing and Urban Development (HUD), the “Conference on the Future of Housing Finance” seeks… Continue reading Reshaping The Mortgage Industry
<Click on chart for larger image> NAHB: Builder Confidence Declines In August Builder confidence in the market for newly built, single-family homes edged down for a third consecutive month in August, according to the latest National Association of Home Builders/Wells Fargo Housing Market Index (HMI), released today. The HMI declined one point to 13, its… Continue reading Housing