New York Fed

Stockman Slams "Simple Janet"'s Incoherent Babble

We now have an absolutely clear idea of why the Fed is impaled on its own petard. At the end of the day, managed rates will prove to be the ultimate destroyer of capitalism. They transform financial markets from organizers and allocators of real capital and the savings of producers and workers into gambling casinos which fuel massive speculative bubbles.

Former Fed Employee Avoids Jail, Gets $2,000 Fine For Stealing Fed Secrets On Behalf Of Goldman Sachs

Jason Gross was the latest former banker to make a mockery of the US judicial system when he was spared prison on Wednesday, for stealing NY Fed secrets on behalf of Goldman Sachs. Instead Gross, 37, was fined $2,000 by U.S. Magistrate Judge Gabriel Gorenstein in Manhattan and sentenced to a year of probation with 200 hours of community service after pleading guilty to a misdemeanor charge of theft of government property.

US Recession Data Signals It's A Very Short Road To Capital Controls

Bottom line – the economy is due for a recession and the indicators suggest that one may already be in the works. But if you listen to SF Fed's Williams (for example), the narrative goes something like this: "Everything's awesome. Stop asking questions." What if The Fed is wrong (again) - Today, interest rates are at 0.25%... next to nothing. That means that even if the next (i.e. current) recession is extremely mild, interest rates are practically guaranteed to go below zero... And from there, it’s a very short road to capital controls.

Financial Time Bombs Hiding In Plain Sight

The bear will soon be arriving in earnest, marauding through the canyons of Wall Street while red in tooth and claw. Our monetary central planners, of course, will once again - for the third time this century - be utterly shocked and unprepared. That’s because they have spent the better part of two decades deforming, distorting, denuding and destroying what were once serviceably free financial markets. Yet they remain as clueless as ever about the financial time bombs this inexorably fosters.

Baby Boomers Are Drowning In Loans: Debt Of Average 67-Year-Old Soared 169% In Past 12 Years

Americans in their 50s, 60s and 70s - the Baby Boom generation - are carrying unprecedented amounts of debt, a shift which according to the WSJ "reflects both the aging of the baby boomer generation and their greater likelihood of retaining mortgage, auto and student debt at much later ages than previous generations." While aggregate debt of Gen-Xers has admirably declined by 12% in the past 12 years, the aggregate debt of the average Baby Boomer has soared by an unprecedented 169%!

Goldman's Take: "Additional Hikes Remain FOMC Baseline"

"BOTTOM LINE: Chair Yellen’s prepared remarks to the House Financial Services Committee contained little new information on the monetary policy outlook, and were roughly in line with comments made by Vice Chair Fischer and New York Fed President Dudley over the past couple weeks. She continued to highlight the FOMC’s expectation for “gradual” increases in the federal funds rate."

Crunch Time?

It seems monetary policy is exhausted and the next exogenous lever to pull would be political fiscal initiatives. If/when they fail to stimulate demand, there would be only one avenue left – currency devaluation. If/when confidence in the mightiest currency wanes, we would expect the US dollar to be devalued too - not against other fiat currencies, but against a relatively scarce Fed asset.