Recession

Tyler Durden's picture

The Regressive Fed





In a move that defines the word 'irony' better than the dictionary does, the Federal Reserve raised rates just five hours after their own Industrial Production series was released showing an almost certain entry into a US recession. The Federal Reserve's hidden role as banking lobbyist won out over their populist role as counter-cyclical policy provider and they raised rates for the wrong reasons, putting them in the US-1936 and Japan-2000 policy mistake club.

 
Tyler Durden's picture

What The Fed Did Not Do





We will not spend much time discussing what the FOMC did as tons of ink have been spilled on that already. We will rather spend more time on what the FOMC did not do.

 
Tyler Durden's picture

Kansas City Fed Survey Collapses As New Orders Crash Most Since Great Recession





Another data point to ignore... Kansas City Fed's business survey has crashed from a hope-full bounce. Dumping from a +1 print in October, Kansas collapsed to -9, the weakest since May 2015 as across the board components were abysmal. Production, Prices Paid, Employees, and inventories all cliff-dived with New Orders falling the most YoY since the Great Recession.

 
Tyler Durden's picture

A Big, Fat "Policy Error" Or Worse? Find Out Tomorrow





Did 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?

 
Tyler Durden's picture

Gold & The Federal Funds Rate





It 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.

 
Tyler Durden's picture

3 Things: Tick-Tocks, Stocks, & Shocks





Please 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.

 
GoldCore's picture

Federal Reserve Rate Hike At ‘Precisely The Wrong Time’ – Faber





Yesterday’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.

 
Tyler Durden's picture

"In Short Janet, It's Too Late" - Albert Edwards Calls It With These Seven Charts





"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."

 
Tyler Durden's picture

November Unemployment Hits Seven Year High In Brazil As Supreme Court Mulls Impeachment Bid





Brazil's Supreme Court green lighted House Speaker Eduardo Cunha's Rousseff impeachment bid on Wednesday, even as the high court is also considering a request for his removal. Meanwhile, the economy continues to deteriorate as we just got the highest unemployment reading for the month of November in seven years."

 
Tyler Durden's picture

What The Market Chose To Ignore In Yesterday's Fed Announceent





The hard part now is how to ween the market away from the old narrative, the one which has pushed the S&P to record highs over the past 7 years on bad economic news, and to renomralize the market's own "reaction function" to that of the Fed. The problem is that from day one there is a major discrepancy between the two: as previouslly observed, the Fed did not deliver the desired dovish hike, and kept its 2016 year-end fed funds rate unchanged at 1.4% suggesting 4 rate hikes in the coming year, and which as Breslow notes means "being less dovish than the meeting previews suggested is now a sign of bullishness on the economy." This sets the Fed on a collision course with the market because "with the market pricing fewer hikes than the Fed suggests, someone is going to end up being wrong."

 
Tyler Durden's picture

The Fed Hike Will Unleash A Monster Dollar Rally Goldman Predicts; Merrill Disagrees





The "long dollar" trade may be the most crowded ever but that doesn't mean there aren't disagreements where the greenback goes from here, especially after the Fed's historic first rate hike.

 
Tyler Durden's picture

Presenting Saxo Bank's 10 "Outrageous Predictions" For 2016





"The irony in this year’s batch of outrageous predictions is that some of them are “outrageous” merely because they run counter to overwhelming market consensus. In fact, many would not look particularly outrageous at all in more “normal” times – if there even is such a thing!"

 
Tyler Durden's picture

On The Important Role Of Recessions - Austrians Had It Right





The continued misuse of capital and continued erroneous monetary policies have instigated not only the recent downturn but actually 30 years of an insidious slow moving infection that has destroyed the American legacy. “Recessions” should be embraced and utilized to clear the “excesses” that accrue in the economic system during the first half of the economic growth cycle. Trying to delay the inevitable, only makes the inevitable that much worse in the end.

 
Tyler Durden's picture

Billionaire Sam Zell Warns The Fed Is Too Late, "Recession Likely In Next 12 Months"





“I think this interest rate hike is too late. This economy is closer to falling over than it is to going up. I think there’s a high probability that we’re looking at a recession in the next twelve months."

 
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