Monetary Policy
Market Shudders As Brazil Risks "Succumbing To Fiscal Populism" With New FinMin
Submitted by Tyler Durden on 12/19/2015 13:15 -0500Brazil has a new finance minister and the market is not happy. As BofAML puts it, "the focus turns now to the direction of the fiscal policy under the new FinMin, which should affect the recovery in confidence and thus growth. With mounting downside risks to growth that heavily weigh on the government’s revenues and the ongoing challenges in passing fiscal measures in Congress, tangible results over statements will now be needed to improve expectations over primary fiscal results ahead."
5 Key Charts Show Rising Interest Rates Good For Gold Bullion
Submitted by GoldCore on 12/19/2015 11:57 -0500In the short term, increases in interest rates can be negative for gold. But, in the medium to long term rising interest rates are positive for gold as they were in the 1970s and the 2003 to 2006 period.
Central Banks Are Rapidly Running Out of Options
Submitted by Phoenix Capital Research on 12/19/2015 11:40 -0500What happens the next time global GDP takes a nosedive when Central Banks have already used up all of their ammunition?
House Passes $1.15 Trillion Spending Bill: Here Is What's In It
Submitted by Tyler Durden on 12/18/2015 11:53 -0500Moments ago, the House of Representatives just passed the $1.15 trillion spending bill that includes a $680 billion package of tax-break extensions, in a 316 to 113 vote, and will now move to the Senate, where its passage is likewise assured and will be signed by the president over the next few days. For those wondering what are the main components of the spending bill, here is a quick summary.
David Stockman Warns "Dread The Fed!" - Sell The Bonds, Sell The Stocks, Sell The House
Submitted by Tyler Durden on 12/18/2015 11:50 -0500Yellen and her cohort have no clue, however, that all of their massive money printing never really left the canyons of Wall Street, but instead inflated the mother of all financial bubbles. So they are fixing to blow-up the joint for the third time this century. That was plain as day when our Keynesian school marm insisted that the Third Avenue credit fund failure this past week was a one-off event - a lone rotten apple in the barrel. Now that is the ultimate in cluelessness.
Futures Slide As Quad-Witching Has A Violently Volatile Start After Massive BOJ FX Headfake; Oil Tumbles
Submitted by Tyler Durden on 12/18/2015 06:49 -0500- Australia
- Bank of Japan
- Beige Book
- Bond
- Central Banks
- China
- Copper
- CPI
- Crude
- Crude Oil
- default
- Economic Calendar
- Equity Markets
- Federal Reserve
- fixed
- France
- Germany
- headlines
- Hong Kong
- Hungary
- Initial Jobless Claims
- Japan
- Jim Reid
- Kuwait
- Markit
- Mexico
- Monetary Base
- Monetary Policy
- Natural Gas
- New Zealand
- Nikkei
- Norges Bank
- Philly Fed
- Precious Metals
- Price Action
- RANSquawk
- Real estate
- Sheldon Adelson
- Ukraine
- Volatility
- Yen
Following the latest BOJ statement, the market found itself wrongfooted assuming the BOJ was actually launching another episode of easing, sending the USDJPY soaring, until suddenly the realization swept the market that not only was the incremental action not really material, but even Kuroda spoke shortly after the announcement, confirming that "today's decision wasn't additional easing." The result was one of the biggest FX headfakes in recent days, perhaps on par with that from December 4 when EUR shorts were crushed, as the biggest carry pair first soared then tumbled and since the Yen correlation drives so many risk assets, also pulled down not only Japanese stocks but US equity futures.
A Big, Fat "Policy Error" Or Worse? Find Out Tomorrow
Submitted by Tyler Durden on 12/17/2015 23:51 -0500Did algos finally figure out precisely what we said first thing this morning, namely that the market completely ignored what was a hawkish hike, and that as a result, what Yellen has done, now that the kneejerk reaction is over, is policy error, pure and simple?
Gold & The Federal Funds Rate
Submitted by Tyler Durden on 12/17/2015 20:05 -0500It is widely assumed that the gold price must decline when the Federal Reserve is hiking interest rates. It seems logical enough: gold has no yield, so if competing investment assets such as bonds or savings deposits do offer a yield, gold will presumably be exchanged for those. There is only a slight problem with this idea. The simple assumption “Fed rate hikes equal a falling gold price” is not supported by even a shred of empirical evidence.
How The Fed Just Launched The Next Bear Market: BofA's Unexpected Conclusion In 8 Charts
Submitted by Tyler Durden on 12/17/2015 17:10 -0500"Rising rates and falling profits are not a good combination for asset prices, so we will turn sellers of risk in early 2016."
3 Things: Tick-Tocks, Stocks, & Shocks
Submitted by Tyler Durden on 12/17/2015 16:30 -0500Please meet the “worst economic forecasters” ever. And while the mainstream media quickly laps up the optimistic outlook of the Fed, you might want to consider their own record of forecasts when making long-term investment bets. Based on statistical history combined with the current underpinnings in the market, the outlook really isn’t as bright as Ms. Yellen suggests.
Watch the Lines! Bull Markets Close to Ending in Major Markets
Submitted by Phoenix Capital Research on 12/17/2015 16:04 -0500Take note, these charts signal that the bull markets of the last six years are ending. The markets are primed for another Crash, just as they were in 2000 and 2007.
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Federal Reserve Rate Hike At ‘Precisely The Wrong Time’ – Faber
Submitted by GoldCore on 12/17/2015 14:42 -0500Yesterday’s hike still leaves U.S. monetary policy extremely loose, and Fed officials have signaled they will act cautiously from to nurture a very tenuous recovery indeed.
"In Short Janet, It's Too Late" - Albert Edwards Calls It With These Seven Charts
Submitted by Tyler Durden on 12/17/2015 12:59 -0500"The party's over and bond investors who always tend to be more sober types, realize this and have headed for the exits whereas equity investors are so intoxicated they haven't realized that the music has stopped. Equity investors are still gyrating around the dance floor - just as in 1999 and 2007... I believe the Yellen Fed will soon be treated with the same contempt the Greenspan Fed was in the aftermath of the 2008 financial crisis. And they will deserve it."
Global Stocks, Futures Continue Surge On Lingering Rate Hike Euphoria
Submitted by Tyler Durden on 12/17/2015 06:59 -0500- Aussie
- Boeing
- Bond
- Brazil
- Centerbridge
- China
- Conference Board
- Continuing Claims
- Copper
- CPI
- Crude
- Crude Oil
- Equity Markets
- Fed Fund Futures
- Fitch
- fixed
- Germany
- Gilts
- High Yield
- Housing Starts
- India
- Initial Jobless Claims
- Japan
- Jim Reid
- Monetary Policy
- Nat Gas
- New Zealand
- Nikkei
- Norges Bank
- Philly Fed
- Price Action
- RANSquawk
- Trade Deficit
- Unemployment
- Yen
Heading into the Fed's first "dovish" rate hike in nearly a decade, the consensus was two-fold: as a result of relentless telegraphing of the Fed's intentions, the hike is priced in, and it will be a "dovish" hike, with the Fed lowering its forecast for the number of hikes over the next year. Consensus was once again wrong on both accounts: first the rate hike was far more hawkish than most had expected (see previous post), and - judging by the surge in Asian, European stocks and US equity futures - the "market" simply is enamored with such hawkish hikes which will soon soak up trillions in liquidity from the financial system.





