• Marc To Market
    11/22/2014 - 10:16
    Contrary to the death of the dollar chatter, the US currency continues to appreciate.  Here's why there is still punch left in the bowl.  
  • Tim Knight from...
    11/21/2014 - 21:06
    As you can see by this view of the NQ, this massively bullish news has not, as of yet, represented any kind of sea-change in the markets. Before the day was even out (again, in some, not all markets...

Kohn

Tyler Durden's picture

The Future Is Smaller - That's The Only Way This Works





History tells us that large governments almost invariably lead to waste, corruption, and overextension of power. It’s the large governments that rattle the sabers and constantly threaten warfare. It’s large governments that maintain police states, that spy on their citizens, and commandeer nearly every personal choice imaginable with regulatory agencies that tell us how to educate our children and what we can/cannot put in our own bodies. As Kohr theorized, bigness often leads to tyranny.

 
Tyler Durden's picture

With The World Burning Around Them, The Fed Was Debating This Epic Question





"We are not clueless," Kevin Warsh notes in this September 16th 2008 Federal Reserve transcript (as the entire financial system was imploding around them); but it is the final 'debate' in this brief section that sums up what Marc Faber has feared all along. Adjective or Abverb?

 

 
Tyler Durden's picture

Jabba The Hutt, Jerome Kerviel, Davos And Market Reflexivity: Tying It All Together





"When the market is in the depressive phase of what President Lockhart referred to as a bipolar disorder, crafting policy to satisfy it is like feeding Jabba the Hutt—doing so is fruitless, if not dangerous, because it simply will insist upon more." - Fed's Dick Fisher

 
Tyler Durden's picture

At Least The Fed Ended The Catastrophic 2008 On A Funny Note





The world may have been crashing and burning, and as Bernanke admitted in March 2008, "At some point, of course, either things will stabilize or there will be some kind of massive governmental intervention, but I just don’t have much confidence about the timing of that" (guess which one it was), but at least the Fed ended the catastrophic 2008 yeat on a high note. The chart below shows the number of the time the FOMC committee had an moment of levity as captured by [Laughter] in the FOMC transcripts. Perhaps not surprisingly, the December 2008 meeting, when the market was in free fall, saw the biggest number of laugh lines in the entire year.

 
Tyler Durden's picture

Futures Sneak Above 1800 Overnight But Yellen Can Spoil The Party





A sneaky overnight levitation pushed the Spoos above 1800 thanks to a modest USDJPY run (as we had forecast) despite, or maybe due to, the lack of any newsflow, although today's first official Humphrey Hawkins conference by the new Fed chairman, Janet Yellen, before the House and followed by the first post-mortem to her testimony where several prominent hawks will speak and comprising of John B. Taylor, Mark A. Calabria, Abby M. McCloskey, and Donald Kohn, could promptly put an end to this modest euphoria. Also, keep in mind both today, and Thursday, when Yellens' testimoeny before the Senate takes place, are POMO-free days. So things may get exciting quick, especially since as Goldman's Jan Hatzius opined overnight, the third tapering - down to $55 billion per month - is on deck.

 
Tyler Durden's picture

Key Events And Issues In The Coming Week





Looking ahead, Thursday will be a busy day with the ECB (plus Draghi’s press conference) and BoE meetings. Some are expecting the ECB to cut rates as early at this week although most believe the rate cut will not happen until December. Draghi will likely deflect the exchange rate’s relevance via its  impact on inflation forecasts. This could strengthen the credibility of the forward guidance message, but this is just rhetoric — a rate cut would require a rejection of the current recovery hypothesis. They expect more focus on low inflation at this press conference, albeit without pre-empting the ECB staff new macroeconomic forecasts that will be published in December.

 
Tyler Durden's picture

Yet Another "Most Important FOMC Meeting Ever" Begins





Overnight trading started with Asian markets continuing where yesterday's S&P 500 fizzle ended, wishing Summers could withdraw from Fed running again, as both the Nikkei and SHCOMP were well lower by the close. Perhaps all the easy multiple-expanding, headline-driven money is made, or perhaps economic fundamentals will finally start having to justify a 17x multiple on the S&P (a good is good regime for those who may be too young, or old, to remember), but overnight US futures were dull, and no doubt anticipating today's start of the "Most important FOMC meeting ever", which concludes tomorrow with an announcement by the Fed of what and how much (if any) tapering it will commence with an eye toward halting QE next summer, although more realistically what will happen is an Untaper being announced before then. While the start of the FOMC meeting is the main event, today we get CPI, TIC flows and the NAHB housing market index. Today's POMO is another modest $1.25-$1.75 billion in the long-end sector.

 
Tyler Durden's picture

Time To Cross Donald Kohn Out Too





First, Summers steps away; Second, Geithner politely declines; and now - just as his odds of becoming the next Fed Head begin to rise, Donald Kohn drops the following headline bomb-shells at a Brookings' event this morning

KOHN: BAIL-IN NEEDED TO PROTECT FINANCIAL SYSTEM FROM TOO BIG TO FAIL FIRMS
KOHN: VERY EASY MONETARY POLICY CAN CREATE DANGEROUS RISKS
Kohn: Problems can arise when one policy [monetary or financial regulation] is leaning so hard in one direction

That should be enough to effectively remove himself from the running... It seems we are back to the lowest common denominator Fed-head - so much for American exceptionalism again.

 
GoldCore's picture

Gold Up In Asia After Summers Exits Fed Race - Dovish Yellen Gold Positive





Gold and silver futures surged 2.1% and 3.6% respectively and the dollar fell on the open in Asia prior to determined selling which again capped precious metal prices. Analysts and media attributed the price gains on the withdrawal of Larry Summers from the race to be the new Fed Chairman, leaving Janet Yellen as the new frontrunner.

 
Tyler Durden's picture

Yellen Storms Back To Top Of Fed Chairman Bookmaker Odds





When the tracking of potential Ben replacement candidates for Fed Chairman by Irish bookmaker Paddy Power, and InTrade prop bet replacement, started it had Janet Yellen as a solid favorite. Shortly thereafter, as news leaked that Obama's favorite was Larry Summers, and as the president made it quite clear Yellen's candidacy was certainly not on the front Burner with the "Mr. Yellen" Freudian slip, Summer's odds soared and hit a contract high of 85% last week. Over the weekend, anyone who had put money on Summers, was Harvarded and lost all capital at risk, and now, it is Yellen who is once again firmly in the lead with her odds soaring right back to just why of 90%, and well-ahead of second placed Don Kohn at 17%. Ironically, while the market never actually corrected for the "market negative" that Larry Summers' candidacy is now spun to be, it is surely uncorrecting now that he is out.

 
Tyler Durden's picture

Gone Fisch(er)-ing; And The 'Summers' Of Our Discontent





It had become clear that the President's own political base in the Senate were not going to support Mr. Summer's ascendancy. The eye of the Press will now turn to Mr. Kohn, Ms. Yellen, who does not seem to have the support of Mr. Obama, and the long, though interesting shot, of Stanley Fischer. Mr. Obama appears to be easing into a lame duck presidency far earlier than once thought and the reality of Obamacare will hit Main Street on October 1 which may tip the scales further out of his control. It may not be either the best of times or the worst of times but very volatile times that mark this week.

 
Tyler Durden's picture

(Ir)Rational Overnight Exuberance On Summers Withdrawal Sends Futures To All Time Highs





While the only market moving event of note had nothing to do with the economy (as usual), and everything to do with the Fed's potential propensity to print even more dollars and inject even more reserves into the stock market (now that Summers the wrongly perceived "hawk" is out) some other notable events did take place in the Monday trading session. Of note: while India's August inflation soared far higher than the expected 5.7%, rising to 6.1% from 5.79% (making life for the RBI even more miserable, as it is fighting inflation on one hand, and a lack of liquidity on the other), in Europe inflation decelerated to 1.3% from 1.6% in July driven by a drop in energy prices, while core inflation was a tiny 1.1%. In a continent with record negative loan growth this is to be expected. Additionally, as also reported, Merkel appears to be positioned stronger ahead of this weekend's Federal election following stronger results for her CDU/CSU, if weaker for her broader coalition. In Libya, oil protesters said they would continue stoppages at oil terminals until their demands are met in yet another startling outcome for US foreign intervention. Finally, some headline on Syria noted a Kerry statement "will not tolerate avoidance of a Syria deal", while Lavrov observed that it may be time to "force Syria opposition to peace talks." And one quote of the day so far: "Don't want market to become excessively exuberant" from the ECB's Mersch- just modestly so?

 
Tyler Durden's picture

Hilsenrath Confirms Summers Out Means Fed Business-As-Usual





UPDATE: *GEITHNER STILL DOESN'T WANT TO BE CONSIDERED FOR FED CHIEF: WSJ

The next chairman's main job is going to be deciding how soon and how aggressively to pull back on Fed programs; and as none other than Fed whisperer John Hilsenrath notes, Larry Summers' withdrawal increases the likelihood of continuity in central-bank policy for the next few years - meaning any Fed wind-down of its easy-money programs will be slow and gradual. Of course he posits Yellen and Kohn as potential front-runners but throws Tim Geithner and Roger Ferguson back into the mix. Business-as-usual is back and the doves are in control - all the Fed needs now is bigger deficits to enable it to keep the pumps primed...

 
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