St Louis Fed

St Louis Fed
Tyler Durden's picture

The Path To Rate Normalization Will Not Come Without Pain





Market pundits robotically suggest that the Fed should not raise rates because inflation is too low.  Well, if zero rates and $4 trillion in asset purchases did not boost inflation, do they really believe that another few months at zero rates will do the trick?  Some Fed researchers are actually asking whether policies have become counter-productive to their dual mandates. The path to rate normalization will not come without pain. On the contrary, there will be a difficult period, potentially even a damaging recession.  Fed doves will likely feel vindicated.  However, while a period of hardship is likely inevitable, purging both bad businesses and market speculation is vital for long-run economic health and will allow more productive businesses to evolve over time.

 
Tyler Durden's picture

Stocks Soar Into The Green As Question Emerges: "Rate Hike Or QE4 First?"





It appears that the Fed's cunning plan to hike rates so it can cut rates was just foiled once again.

 
Sprott Money's picture

U.S. Wages Have Fallen EVERY Quarter of the 'Recovery'





For 6 ½ long years, we have been bombarded with the mythology known as “the U.S. economic recovery” by the mainstream media. 

 
Tyler Durden's picture

Peter Schiff: What Kind Of "Improvement" Does The Fed Want?





If GDP growth only averages 2.0% in the Second Half (which I think is likely), then 2015 growth will only be about 1.7% annually. Given that the Fed didn't raise rates in 2012, 2013, and 2014, when growth was well north of 2%, why would they do so now? Yet Wall Street and the media stubbornly cling to the notion that 3% growth and rate hikes are just around the corner. Old notions die hard, and this one has taken on a life of its own.

 
Tyler Durden's picture

Why Obama's Favorite Student Debt "Relief" Program Will Cost Taxpayers $100 Billion





Did you take out a $245,000 loan to pay for your degree? Good news, the Department of Education wants you to know that "your payment could be as low as $0 a month!"

 
Tyler Durden's picture

"I Sure Am Glad There's No Inflation"





I sure am glad there's no inflation, because these "stable prices" the Federal Reserve keeps jaw-jacking about are putting us in a world of hurt.

 
Tyler Durden's picture

Gold and Gibson's Paradox





There is a myth prevalent today that the gold price always falls when interest rates rise. The logic is that when interest rates rise it is more expensive to hold gold, which just sits there not earning anything. And since markets discount future expectations, gold will even fall when a rise in interest rates is expected. With the Fed's Open Market Committee debating the timing of an interest rate rise to take place possibly in September, it is therefore no surprise to market commentators that the gold price continues its bear market. Only the myth is just that: a myth denied by empirical evidence.

 
Tyler Durden's picture

Nine Reasons Why Low Oil Prices May "Morph" Into Something Much Worse





Why are commodity prices, including oil prices, lagging? Ultimately, it comes back to the question, “Why isn’t the world economy making very many of the end products that use these commodities?” If workers were getting rich enough to buy new homes and cars, demand for these products would be raising the prices of commodities used to build and operate cars, including the price of oil. If governments were rich enough to build an increasing number of roads and more public housing, there would be demand for the commodities used to build roads and public housing. It looks to me as though we are heading into a deflationary depression, because prices of commodities are falling below the cost of extraction. We need rapidly rising wages and debt if commodity prices are to rise back to 2011 levels or higher. This isn’t happening.

 
Tyler Durden's picture

Commodity Rout Halted On Dollar Weakness, Equities Unchanged





If yesterday's market action was boring, today has been a virtual carbon copy which started with the usual early Chinese selloff levitating into a mildly positive close, with the SHCOMP closing just above the psychological 4,000 level: the next big hurdle will be 4058, the 38.2% Fib correction of the recent fall. In the US equity futures are currently unchanged ahead of a day in which there is no macro economic data but lots of corporate earnings led by Microsoft, Verizon, UTX and of course Apple. Most importantly, some modest USD weakness overnight (DXY -0.1%) has helped the commodity complex, with gold rebounding from overnight lows, while crude has at least stopped the recent carnage which sent WTI below $50.

 
Tyler Durden's picture

A Serial Short Seller Asks "Do Governments & Central Banks Ever Lose?"





It's true that “the authorities” want the price of financial assets (stocks, bonds) to go up, and the price of hard assets (commodities) to go down… which is exactly what has happened. So do governments and central banks ever lose? In the old days, they lost all the time. In one extreme example, an individual hedge fund took out the entire Bank of England. But central banks are currently on a massive winning streak. So to answer the question, “Will we ever have a crisis,” you need to answer the question, “Will we ever be allowed to have one?”

 
GoldCore's picture

Global Debt Time Bomb Ticks – Puerto Rico Is Next





With all eyes on Greece it would seem another crisis relating to unpayable debt is brewing in the Caribbean. The governor of Puerto Rico, Alejandro García Padilla, has warned that the island is unable to pay its debts of $72 billion.

 
Tyler Durden's picture

Market Wrap: Greek "Capitulation" Optimism Sends Global Risk Higher After China Re-crashes





So much going on that by the time an article is prepared, everything has changed and it has to be scarpped. But, in any event, here is an attempt to summarize all that has happened in another turbulent overnight session.

 
Tyler Durden's picture

Fed Examines Wealth Redistribution Program; Decides It's Not Worth It





After seven long years of aggressively defending a monetary policy regime that's served to exacerbate the divide between the haves and the have-nots, the Fed looks at whether "the legend of Robin Hood" offers any helpful pointers about how to reignite America's economic growth engine. Spoiler alert: the Fed doesn't think "taking from the rich to give to the poor" would be very productive.

 
Tyler Durden's picture

If Greece Defaults, Will The Fed (& US Taxpayers) Bailout Europe?





With The IMF (and Germany to a less extent) apparently peeing in the Greek Deal pool, perhaps it is worth considering what happens next if this "Greece is rescued" deal is not done. Who can save Greece? Who will pay The IMF? Why, that's simple, the good ol' American taxpayer thanks to The Fed's lifeline...

 
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