Central Banks

Steve H. Hanke's picture

Why was international financial officialdom so eager to raise banks’ capital-asset ratios? The starting point for the global bank capital obsession is found in Britain and its infamous Northern Rock affair. Indeed, this was the true beginning of the Great Financial Crisis and the Great Recession.

Risk Off: Global Stocks Slide As "Fire And Fury" Results In "Selling And Fear"

US futures are set for a sharply lower open (at least in recent market terms) following a steep decline in European stocks and a selloff in Asian shares, following yesterday's sharp escalation in the war of words between the U.S. and North Korea. In a broad risk-off move U.S. Treasuries rose, the VIX surged above 12 overnight, while German bund futures climbed to the highest level in six weeks.

The Most Important Chart For Stocks

"Since the collapse of Lehman Brothers in 2008, central banks have bought $10.8 trillion in assets, and that liquidity has propelled financial markets all over the world. Now it appears that we are on the cusp of global synchronized monetary tightening..."

"The World's Most Feared Investor" Lashes Out At Safe Spaces

"Central bankers who are desperately attempting to keep asset prices well above their free-market values serve to create the very opposite of a "safe space." It is actually a brittle and unsustainable space — brittle because nobody knows when the artificial constraints on volatility and price-discovery will suddenly and tectonically shift and return closer to historically-normal levels."

Why Blackrock Isn't Worried At All About Record Low Volatility

"Low stock market vol only seems to keep getting lower. Yet we believe there are good reasons for vol to be subdued. Looking back, we find low-vol regimes, when U.S. equity volatility averages 10%, can last for years. That means realized U.S. equity vol has historically stayed low for remarkably long periods of time."

Key Events In The Coming Vacation Week: All About Inflation

With the traditional post-payrolls market lull setting in, and most trading desks taking a week or two off, it will be a relatively quiet week with attention turning to inflation data with releases in the US, China, Norway & Switzerland, a key factor as central banks consider if/when to tighten in the near future.