Analysis Topic: Interest Rates and the Bond Market
The analysis published under this topic are as follows.
Thursday, April 24, 2014
The Central Banks Have Realized Their Worst Nightmares Are Approaching / Interest-Rates / Quantitative Easing
By: Graham_Summers
Central Bankers will never openly admit that they or their policies have failed. Moreover, they do not rush into sudden tightening (more on this in a moment). But one can begin to notice subtle changes in their language and actions that indicate they have noticed what’s happening in Japan (the failure of the BoJ’s “shock and awe” QE program to generate growth).
Nowhere is this more clear than at the US’s Federal Reserve or Fed. Indeed, starting in August 2013, various Fed officials began questioning the efficacy of QE.
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Wednesday, April 23, 2014
QE Is A Fraud Perpetrated By Made Men / Interest-Rates / Quantitative Easing
By: Raul_I_Meijer
A lot of words are being spent again these days on deflation and the QE measures that are supposed to “cure” it. Paul Krugman, who when it comes to stimulus is a hammer seeing nails only, now has it in for Sweden’s central bank, which he labels monetary sadists for not opening the spigots. But it’s all a hugely deceptive false flag; it’s not an issue of whether you launch QE or not. There’s a third, and much more valid, way of looking at this.
Wednesday, April 23, 2014
G-20 and the US Tell the Bank of Japan to End Quantitative Easing / Interest-Rates / Quantitative Easing
By: Mike_Whitney
It looks like QE is going to end with a whimper instead of a bang.The bigwigs in the G-20 have put the kibosh on Japan’s money printing extravaganza. While most analysts expect the Bank of Japan (BoJ) to announce more “easing” in the days ahead to counter weakening economic data and droopy stock prices; it’s not going to happen. Why? Because the big boys have told the BoJ to knock it the hell off, that’s why? Here’s the scoop from the Japan Times:
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Tuesday, April 22, 2014
Rates are NOT Rising! / Interest-Rates / US Interest Rates
By: Jonathan_Davis
Back in December our firm noted that ‘everyone’ was saying interest rates would soon rise. After all, they said, The Governor of the Bank of England and the Federal Reserve of the US had all but announced it.
We also noted that rates had been falling for getting on for 40 years.
We wondered if those saying higher rates are coming were looking in the wrong places.
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Thursday, April 17, 2014
Amazing Story From Japan - Bond Market Liquidity Dries Up / Interest-Rates / Credit Crisis 2014
By: John_Rubino
Here’s something you don’t see very often: For a day and a half this week, the Japanese government’s benchmark 10-year bonds attracted not a single successful private sector bid. At today’s artificially-depressed yields, no one wants this paper — except of course the Bank of Japan, which is buying up the bonds with newly-created yen. As the Gulf Times noted:
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Wednesday, April 16, 2014
Glaring Q.E. Failure Spotted - Money Velocity Is Falling Rapidly / Interest-Rates / Quantitative Easing
By: Jim_Willie_CB
Sometimes pictures are far more effective in communicating an important point. They are extremely effective in undermining respect and confidence, when in the cartoon format. A sequence of graphics struck the cognitive circuits recently. Long explanations will not serve well. The US Federal Reserve has been printing money since 2011 to cover USGovt debt securities in a frenetic manner. They have lost control. They call it stimulus, when it is actually the opposite. It does assist the speculators with nearly zero cost money to borrow, but one must be a club member to win loan grants.
Tuesday, April 15, 2014
The Real Purpose Of QE - It’s Not Employment / Interest-Rates / Quantitative Easing
By: Darryl_R_Schoon
Free markets are a function of supply and demand whereas capital markets are a function of credit and debt
The bankers’ ponzi-scheme – which began with the distortion of free markets in 1694 when the Bank of England began issuing debt-based paper banknotes alongside the Royal Mint’s gold and silver coins – is coming to an end.
The bankers’ wildly successful and long-running scheme, dependent on the uneasy equilibrium between credit and debt, has now been irrevocably destabilized. Aggregate levels of debt are now so high that credit—no matter how cheap and available—cannot restore the balance.
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Monday, April 14, 2014
Get Your Share of an Extra Trillion Euros Money Printing / Interest-Rates / Eurozone Debt Crisis
By: Money_Morning
Peter Krauth writes: When Gutenberg introduced the printing press to Europe, he never could have imagined this.
Like so many revolutionary inventions, it's proven a doubled-edged sword.
The U.S. Fed has begun winding down its latest QE program (for now), and the baton's already been passed to Japan with its own massive easing campaign.
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Thursday, April 10, 2014
They Snuck In Eurobonds Through The Backdoor / Interest-Rates / Eurozone Debt Crisis
By: Raul_I_Meijer
The headlines are great, but then so is the headfake. “Greece makes ‘triumphant’ return to the markets in €3 billion bond sale”, says the Guardian. CNBC speaks of a “voracious appetite” for Greek bonds, but does question whether it’s justified. Still, at first glance it certainly looks like the Greeks have been welcomed back into the fold of civilized people:
Greece, the country once held responsible for sparking the sovereign debt crisis, managed to attract €20 billion ($27.7 billion) of offers for a new five-year bond and is set to sell €3 billion at a yield of 4.95%.
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Thursday, April 10, 2014
Interest Rate Hikes on the Horizon? Not Likely / Interest-Rates / US Interest Rates
By: Matt_Machaj
Recent weeks were not bad for those gold investors’ hearts filled with golden hopes. The price of gold depends on many factors, but past patterns can give us important hints and suggest which of them are to be carefully studied and properly comprehended. If history were to teach us anything about gold’s past market values it would most primarily be the following: watch out for the feds! Wise observation of government policies is the main driving force for what is happening in the gold market (surely along with supply factors in the longer run). As we discussed a month ago, this is the main reason for the observed correlation between the gold price and the interest rates. Not because interest rates per se are always casually linked to the gold price. But because interest rates are a reflection of current government policies.
Monday, April 07, 2014
Rising Interest Rate Realities / Interest-Rates / Stock Markets 2014
By: Michael_Pento
The entire global economy now clings precariously to one crucial phenomenon. That is, how much longer can the central banks of the developed world artificially suppress interest rates at near zero percent?
The violently-negative market reaction to Janet Yellen's comments during her first press conference was a clear indication of how vulnerable the stock market is to the eventual reality of rising interest rates. All Ms. Yellen did was remind investors that the Fed Funds Rate would have to be moved up from zero percent -- probably beginning in the middle of next year. That was enough to send the major averages cascading downward faster than you could say the words "flash trading."
Wednesday, April 02, 2014
Will the ECB Ever Really do QE? / Interest-Rates / Quantitative Easing
By: MahiFX
There is an outside chance that the European Central Bank could upstage the normally all important US Non-Farm Payroll figures due this Friday with an announcement over new stimulus measures to combat potential deflationary pressures.
Last week Bundesbank President Jens Weidmann and ECB executive board member left open the possibility that the central bank could engage in quantitative easing to counter deflationary pressures in the Eurozone.
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Thursday, March 27, 2014
Japanese Debt Debacle Now Imminent / Interest-Rates / Global Debt Crisis 2014
By: Michael_Pento
I first warned about the impending bust of Japanese Government Bonds (JGBs) when I wrote "Abe Pulls Pin on JGBs" back in January of 2013. In that commentary I laid out the math behind a collapse of the Japanese bond market and economy stemming from the nation's massive amount of government debt, combined with the Bank of Japan's (BOJ's) folly of pursuing an inflation target.
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Tuesday, March 25, 2014
Why Is The Federal Deficit Really Falling? / Interest-Rates / US Debt
By: Dan_Amerman
There are two ways a nation can use economic growth to reduce budget deficits. The first method is to participate in economic growth, with a growing economy increasing tax collections. A second method is to raise taxes so drastically that they consume all economic growth.
Monday, March 24, 2014
Message to the U.S. Fed: Here Are a Few Things That You Can’t Do / Interest-Rates / US Federal Reserve Bank
By: F_F_Wiley
[A]sset purchases are not on a preset course, and the Committee’s decisions about their pace will remain contingent on the Committee’s outlook for the labor market and inflation as well as its assessment of the likely efficacy and costs of such purchases. -March 19 FOMC statement
The excerpt above or some variation has appeared in every one of the Fed’s post-FOMC meeting statements since the beginning of QE3 in September 2012.
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Thursday, March 20, 2014
Fed Changes the Rules to Maintain ZIRP / Interest-Rates / US Interest Rates
By: Michael_Pento
The New Chairperson of the Federal Reserve showed off her dovish feathers after the latest meeting of the FOMC. Ms. Yellen abrogated the threshold of 6.5% on the unemployment rate as the starting point for short term rate hikes and replaced it with amorphous and ambiguous language that allows plenty of wiggle room with rates.
Just like a child sometimes changes the rules of a game in mid-stream in order to guarantee a favorable outcome, the Fed has ripped up the rulebook to suit its own needs.
Wednesday, March 19, 2014
Bank of England Lights A Fuse Under the Field of Economics / Interest-Rates / Quantitative Easing
By: Raul_I_Meijer
There will be many people who don’t care, there will be many more who don’t understand, and there will be boatloads who refuse to believe it’s true, but it still is. The Bank of England, in one single document, discredited, just at first count, 1) the majority of economics textbooks, 2) vast swaths of the entire field of economics, run as it is by economists educated by those same textbooks, 3) most governments’ economic policies, designed by these economists, 4) much of its own work, also designed by the same economists, 5) Paul Krugman and 6) the “committee” that hands Krugman and his ilk their Not-So-Nobel Prizes.
Tuesday, March 18, 2014
Interest Rates - Is Yellen Fishing for Gold? / Interest-Rates / Gold and Silver 2014
By: Axel_Merk
If interest rates are supposed to be on the rise, why has the price of gold gone up so much this year? Is it merely because it is bouncing back after a sharp decline in 2013? We have a closer look at the link between gold and interest rates to gauge how investors may want to approach the bait provided by the Fed.
Friday, March 07, 2014
Crimea Crisis - Euro-zone Economy Hide and Seek / Interest-Rates / Euro-Zone
By: Raul_I_Meijer
Crimea just declared itself part of Russia. Well, its government did. What the status is of that government is unclear, but then that’s also true for the Ukrainian government, which the west is all too eager to declare the one and only. Perhaps the first thing to do for the US and EU is to sit down with Russia and agree on the legal standing of the Kiev government, since without any such agreement no progress can be achieved. They’d have to do that without “Yats” present, because Russia doesn’t recognize him as a talking partner. Putin can promise to leave Yanukovych home if the US does the same with “Yats”.
Thursday, March 06, 2014
Janet Yellen Another Go / Interest-Rates / US Federal Reserve Bank
By: Fred_Sheehan
Advocates for Federal Reserve disclosure harp on the five-year wait for FOMC transcripts. The reasoning goes that institutions in a democracy should be more democratic: let the people know what the Fed plots behind closed doors. The question arises: to what end?
The 2008 transcripts were released in late-February. Most media operations published stories about the Fed's absent-minded professors who missed the importance of failing financial institutions during 2008. This was not news. That has been described over the past five years, among other places, in Panderer to Power. The release, however, was an opportunity to remind investors, retirees, florists, and students receiving government financing of their precarious state.
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