Federal Reserve

Richest Americans Will Control 70% Of Country's Wealth By 2021, BCG Says

"...while wealth inequality in the rest of the world is simply accelerating, in America, it’s gone into overdrive. Right now, 63 percent of America’s private wealth in the hands of U.S. millionaires and billionaires, BCG said. By 2021, their share of the nation’s wealth will rise to an estimated 70 percent."

Welcome To The Valium Era

"Nothing shocks this market... Nothing rocks it... Nothing socks it to it... Nothing does... that is, until something does."

David Stockman Blasts The "Derangement & Danger On The Potomac"

"The American people are being brought to ruin by three institutions that are mortal threats to liberty and prosperity. To wit, the Federal Reserve, the military/industrial/surveillance complex and a sinecured Congress that is burying unborn generations in debt -- even as it sanctimoniously presumes that it is doing god's work by servicing the beltway racketeers who keep it perpetually in office..."

Bill Blain: "It's Tough Being A Central Banker"

How many people seriously believe the strength of the stock market is due to fundamentals of coming explosive growth? Or is the market really focused on the continuing QE cheap money fuelling the equity boom?

Valuations: It Is Different This Time

"Stock investors have been waiting on the Godot of growth for most of this century and one can’t help but wonder at what point they’ll get up and leave the theater..."

Peak Economic Delusion Signals Coming Crisis

"The question is not “when” we will enter collapse; we are already in the midst of an economic collapse. The real question is, when will the uneducated and the biased finally notice? I suspect the only thing that will shock them out of their stupor will be a swift stock market drop, since this is the only factor they seem to pay attention to. This will happen soon enough."

Reflexivity And Why The Fed Must Sell The Long End

"If the Fed were to just let its balance sheet 'run off', it would cause additional pressure on short-term interest rates even as policy rates are rising. It could also potentially invert or further distort the front-end of the yield curve and destabilize the money markets... It would, therefore, behoove the Fed to sell some of its longer dated Treasury holdings to steepen the yield curve."

Fed Reveals Balance Sheet "Normalization" Schedule: Will Reduce Reinvestments By $10BN/Month

Coming in earlier than many expected, the Fed for the first time laid out how it plans to "normalize" its balance sheet which it expects to reduce by trimming reinvestments in TSYs at a rate of $6Bn/month initially, and MBS at $4Bn/month, or a total of $10bn/month, and will increase the reinvestment caps in steps of 10bn at 3 month intervals over 12 months until it reaches a total 50bn per month.

When Will Janet Live Up To Her Reputation?

"The bond market is speaking, but most aren’t listening. It is telling us that Yellen is tightening too quickly. Or at least, she is by no means anywhere near as easy as the popular narrative."

Frontrunning: June 14

  • Federal Reserve Expected to Deliver Rate Increase (WSJ)
  • Fire engulfs London tower block, at least six dead, more than 50 injured (Reuters)
  • Children lost, baby thrown to safety (Reuters)
  • Democrats Accuse Sessions of ‘Stonewalling’ (BBG)
  • World stocks march on as Fed rate hike looms, dollar steady (Reuters)