Analysis Topic: Interest Rates and the Bond Market
The analysis published under this topic are as follows.
Wednesday, September 05, 2012
Federal Reserve Chairman Ben Bernanke Speaking from Jackson Hole / Interest-Rates / Central Banks
By: Ian_R_Campbell
Why read: You will by now have been bombarded for three-plus days by written and verbal commentary on Federal Reserve Chair Bernanke's Friday, August 31, 2012 remarks made from Jackson Hole, Wyoming. You will have observed last Friday afternoon's U.S.$35+ jump in the physical gold price, and the Dow Jones Industrial Average and S&P 500 Index advances on Friday on the same news. Friday was a 'when Mr. Bernanke speaks, everyone listens positively' moment, even if it is 'just possible' that not everything Mr. Bernanke said on Friday ought not to be seen positively.
Wednesday, September 05, 2012
The Quadrillion Dollar Deflationary Debt Raft / Interest-Rates / US Debt
By: Raul_I_Meijer
Our Down Under roving reporter Skip came up with a few interesting questions when watching an interview that Russia Today recently ran with economist Richard Duncan.
Where doth debt take us going forward, and, for that matter, where has it - really - taken us so far? If and when Japan implodes, does that force the US out of the possibility of moving - or already being - into the Japanese deflationary scenario and into something more sinister? Will it be a quadrillion dollar long-term drip-feed, in essence prolonging death, or a massive quadrillion dollar diversion into breakthrough technologies? Both perhaps? Go halfsies?
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Sunday, September 02, 2012
Ultra Easy Monetary Policy and the Law of Unintended Consequences / Interest-Rates / Quantitative Easing
By: John_Mauldin
"No very deep knowledge of economics is usually needed for grasping the immediate effects of a measure; but the task of economics is to foretell the remoter effects, and so to allow us to avoid such acts as attempt to remedy a present ill by sowing the seeds of a much greater ill for the future." – Ludwig von Mises
We heard from Bernanke today with his Jackson Hole speech. Not quite the fireworks of his speech ten years ago, but it does offer us a chance to contrast his thinking with that of another Federal Reserve official who just published a paper on the Dallas Federal Reserve website. Bernanke laid out the rationalization for his policy of ever more quantitative easing. But how effective is it? And are there unintended consequences we should be aware of? Why is it that the markets seem to positively salivate over the prospect of additional QE?
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Thursday, August 30, 2012
Expects U.S. QE3 'Relatively Soon' Says PIMCO's Bill Gross / Interest-Rates / Quantitative Easing
By: Bloomberg
Bill Gross of PIMCO spoke to Bloomberg Television's Trish Regan this afternoon during a special edition of "Street Smart" live from the Bloomberg Link convention headquarters in Tampa, FL and said that he expects more quantitative easing from the Federal Reserve "relatively soon" and that "they have a dual mandate."
Gross said "unemployment is still above 8% and it's obvious that the Fed isn't comfortable, nor is the nation or the economy with 8% unemployment going forward," but that "Ben Bernanke would agree that the next quantitative ease will produce limited results."
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Saturday, August 25, 2012
U.S. Economy: The Financial Tectonic Plates Are Shifting Once Again / Interest-Rates / Financial Markets 2012
By: EWI
History books call the period after the War of 1812 "The Era of Good Feelings."
America was a young nation that had a sense of purpose. National political strife was at a minimum; optimism was in the air.
Major advances in technology and engineering brought the country turnpikes for easier travel and "The Canal Craze" for more efficient commerce.
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Wednesday, August 22, 2012
Eurozone Debt Crisis: Will The Grexit Finally Become Reality? / Interest-Rates / Eurozone Debt Crisis
By: Money_Morning
Ben Gersten writes:
The Eurozone debt crisis has long needed a "Grexit" or some other landmark event to occur to change the direction the beleaguered continent is headed.
When Mario Draghi announced that he would do whatever he can to preserve the euro, it seemed that moment was imminent. Since he uttered those words on July 26, the IBEX 35 in Spain has gained 17%, while Italy's FTSE Milano Italia Borsa is up 13%.
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Wednesday, August 22, 2012
What Happened To The Debt? / Interest-Rates / Eurozone Debt Crisis
By: Raul_I_Meijer
Alright, OK, so we have new sorts of relative highs in European and US stock markets, even as we keep a w(e)ary eye on Shanghai's new lows. The western highs seem to have a lot to do with all kinds of expectations of ECB sovereign bond purchases and/or cooling German resistance against them.
Wednesday, August 22, 2012
Crunch Time for Central Banks / Interest-Rates / Central Banks
By: Michael_Pento
Global central banks have promised to pump an unprecedented amount of money into the system. They are trying to mollify the effects from a global contraction in GDP and the growing likelihood of a war between Israel and Iran.
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Monday, August 20, 2012
ECB Capping Rates on PIIGS? Wait Till Traders Call Its Bluff / Interest-Rates / Eurozone Debt Crisis
By: EconMatters
The big buzz about the debt-embattled Euro Zone on an otherwise quiet Sunday came from German news magazine Der Spiegel that ECB is considering measures to cap the borrowing costs of the crisis-central PIIGS countries. According to Bloomberg,
Monday, August 20, 2012
Bernanke's Dual Mandate Trap / Interest-Rates / US Economy
By: EconMatters
After reporting an uptick of national unemployment rate of 8.3%, it is of little surprise that the Labor Dept. said on Friday that jobless rates rose in 44 U.S. states in July, with many states showing a monthly increase in more than three years.
Wednesday, August 15, 2012
EU Banking Union: even the timing, 9/11, Spells Disaster / Interest-Rates / Euro-Zone
By: ECB_Watch
Even the timing of the Banking Union spells disaster. Proposal to be announced 9/11, says WSJ (Source). Discussed in this post, the ECB taking responsibility for banking supervision.
Cast: Sharon Bowles (EU Parl), Mario Draghi (ECB), Nicolas Véron (Bruegel)
Tuesday, August 14, 2012
Why The Government Is Destroying The U.S. Dollar / Interest-Rates / US Debt
By: Dan_Amerman
The United States government has five interrelated motivations for destroying the value of the dollar:
1. Creating money out of thin air on a massive basis is all that stands between the current state of hidden depression, and overt depression with unemployment levels in excess of those seen in the US Great Depression of the 1930s.
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Monday, August 13, 2012
Time for the "Widowmaker Trade" to Finally Pay Off? / Interest-Rates / International Bond Market
By: DailyWealth
I GUARANTEE someone will get rich on the "Widowmaker Trade" someday...
The question is... is today the day?
Let me explain this guaranteed trade...
Thursday, August 09, 2012
Exactly What Can the ECB Do? / Interest-Rates / Eurozone Debt Crisis
By: Graham_Summers
The markets are continuing their short squeeze, Euro-phoria induced lunacy. As a quick reminder the S&P 500 is up nearly 5% while many European indexes have rallied double digits (Spain’s Ibex is up an unbelievable 17%!)
In light of this, we need to take a look at the facts, because much of this feels too much like 2008 (at that time the S&P 500 rallied 7%, 11%, even 18% based on various “interventions” all of which turned out to be duds)
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Thursday, August 09, 2012
Fed Money Printing Going Digital / Interest-Rates / Central Banks
By: Fred_Sheehan
Federal Reserve Chairman Ben S. Bernanke is threatening us with "further action" if the economy does not do something or other. (He cannot remember his objective from one press conference to the next, so there is no reason anyone else should.) One view holds the chairman has done all he can, but this underestimates his options. First to follow is a summary of what he proposed in advance and what he delivered. Second, there are some options floating through central-banking channels that should not be dismissed. In conclusion, the consequence may be the end of central banking.
Wednesday, August 08, 2012
Europe Is Not a Matter of Opinion… It’s a Matter of Math / Interest-Rates / Eurozone Debt Crisis
By: Graham_Summers
It’s a simply question of math.
I realize my views on Europe are much in the minority. The entire world continues to believe that somehow Mario Draghi or Ben Bernanke have a magical button they can hit that will solve the EU Crisis.
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Wednesday, August 08, 2012
Fed Has Done Enough, Gas Tank is Full Says Fisher / Interest-Rates / Economic Stimulus
By: Bloomberg
Richard Fisher, President of the Federal Reserve Bank of Dallas, spoke with Bloomberg TV's Tom Keene and Sara Eisen today, saying that "we're at the risk of overburdening the central banks" and "we keep applying what I call monetary Ritalin to the system. We all know there's a risk of over prescribing."
Fisher also said that "we have done our job. We have done enough. Just doing more doesn't solve the problem. The problem is engaging the transmission. We provided the gas, the gas tank is full."
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Tuesday, August 07, 2012
The Lingering Locust Clouds Of Zombie Money / Interest-Rates / Eurozone Debt Crisis
By: Raul_I_Meijer
For the financial markets, the situation in Europe can't get bad enough. The worse it gets, the higher the likelihood that more taxpayer funds will be pumped into the system. These funds will not achieve their ostensible goal, which is to "heal" the economies of the countries whose taxpayers are forced to pick up the tab. Those economies have been battered and indebted so badly that there's zero chance of them returning to "normal" growth and paying "normal" returns for many years to come, if ever.
Sunday, August 05, 2012
How to Prepare for the U.S. Treasury Bond Market Apocalypse / Interest-Rates / US Bonds
By: Investment_U
Alexander Green writes: The Wall Street Journal made an interesting observation recently, “Treasury bonds are priced for the end of the world.”
It was a news article, not an opinion piece. But it happens to be the viewpoint of virtually every investor with half a brain – or a modicum of common sense. A few months ago, for instance, the world’s best-known investor, Warren Buffett, wrote in his annual letter to shareholders, “Right now bonds should come with a warning label.”
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Thursday, August 02, 2012
Super Mario Draghi's Diabolic Spiral / Interest-Rates / Eurozone Debt Crisis
By: Raul_I_Meijer
Mario Draghi did a press conference today. "Everyone" was eagerly awaiting it, and nobody seemed to understand it makes no difference what he says. At least, that is, from the point of view of saving the euro, or Spain, or Italy, or the eurozone. Draghi let slip a dumb remark last week at what was essentially no more than an Olympic cocktail party, and now he's supposed to make it all come true. But he didn't say anything of substance then or now, because he doesn't have anything of substance to offer.