Monetary Policy

The Super Bubble Is In Trouble

Once the Super-Bubble pops, we will see for sure what people demand as the ultimate means of payment: gold or cyber units, or both.

Why The Fed Will Fail Once Again

"The Fed’s bungling should come as no surprise... The Federal Reserve has done almost nothing right for at least the past twenty years, if not longer."

Greenwich Endeavors's picture

The Fed just raised the Fed Funds rate by 25 bps to 1.25%.  However, long term rates rallied by 50 bps!  Mohamed A. El-Erian, bond market veteran and specialist wrote today that the Fed should continue to raise rates “and that policy makers should take seriously the growing risk of future financial instability, especially in the absence of a carful normalization”.

Euro Surges, Bunds Tumble On Unexpectedly Hawkish Draghi Comments

The euro surged to its highest in two weeks after Mario Draghi, speaking at the ECB forum in Sintra, Portugal, surprised markets who expected yet another dovish speech from the central banker, who instead signaled that stimulus tapering may be closer than the market anticipated and said factors weighing on inflation in the euro zone were "mainly temporary" and the central bank could look through them.

Draghi Doesn't See "Bubbles" - Let Me Show You Some

"Ask yourself a question: On the day the ECB stops buying, which of you would buy peripheral or European bonds at these prices? Clearly, the first sign of a bubble is the absence of demand in the secondary that offsets the impact of the ECB..."

The Fed's Third Mandate Is Official

"The FOMC wants stocks to stop rising, and they will keep raising rates until they stop... It is stunning that markets are not taking these words more seriously..."

Fed's Dudley Had Some Worrying Remarks During A Closed-To-The-Press Session

"...when financial conditions ease—as has been the case recently—this can provide additional impetus for the decision to continue to remove monetary policy accommodation." Said otherwise, Dudley wants financial conditions tighter, and stocks lower, and will keep hiking rates until the market reacts accordingly.

Key Events In The Coming Busy Week: Yellen, Inflation, Durables And GDP

The main releases this week are the durable goods report on Monday, the Q1 GDP revision on Thursday, and the personal income and spending report on Friday. There are also many speaking engagements by Fed officials including a speech by Fed Chair Yellen on Tuesday.