Monetary Policy

Kuroda Ruined His Chance Of A Second Term By Doing "Stupid Things", Abe Advisor Says

BOJ governor Kuroda has ruined his chances of getting a second full term, according to Nobuyuki Nakahara, who has advised the prime minister on the economy and was an intellectual father of Japan's QE. "They are trying to clean up the mess of negative rates. It’s impossible to do a stupid thing like keeping the yield curve under government control."

Greatest. Fools. Ever!

“In the ruin of all collapsed booms is to be found the work of men who bought property at prices they knew perfectly well were fictitious, but who were willing to pay such prices simply because they knew that some still greater fool could be depended on to take the property off their hands and leave them with a profit.- Chicago Tribune, April 1890. Nothing... ever... changes.

Preview Of Key Events In The Coming Week

Politics will continue to be in focus as US elections draw closer, with attention on post-debate polling numbers high. However, this week should see a pivot toward data with markets looking for evidence of the summer wobble in activity data reversing. In the US the main focus will be the NFP and ISM reports.

Weekend Reading: Back Where We Started

"Acknowledge the complexity of the world and resist the impression that you easily understand it. It’s a basic fact of life that many things ‘everybody knows’ turn out to be wrong."

Will The ECB Buy Stocks?

With The SNB and BOJ already neck deep in their equity-buying experimentation, and even Janet Yellen hinting at it for The Fed, the most pressing question on most liquidity-hunting central-planer-watchers is - when will Draghi start buying stocks? The short answer, from ABN AMRO, is ECB equity purchases are unlikely in the near term.. and even so, The ECB would be increasing the risk on its balance sheet for uncertain, and at best modest gains in economic growth and inflation.

The Central Bank Power Shift From West To East, Game Of Thrones Style

The Fed clings to status quo. Other central banks are vying to knock it down, or at least loosen its grip on them. But the Fed behaves as if it has no idea there are other powerful central banks that want to grab and harness its power. It carries on refusing to acknowledge that there may come a time, sooner rather than later, where its power is attacked. The ramifications of such an attack will impact the standing of the U.S. in the world.  The Fed can carry on being oblivious, but Game of Thrones illustrates the struggles playing out right now.