Category: Quantitative Easing
The analysis published under this category are as follows.
Friday, March 16, 2012
The Power of Cheap Money / Stock-Markets / Quantitative Easing
By: Puru_Saxena
The economies of the developed world are sluggish, unemployment is a real menace and debts are out of control (Figure 1). Nonetheless, the world’s stock and commodity markets are defying all logic and advancing in the face of adverse economic conditions.
Today, many economists and strategists are scratching their heads in disbelief and they are struggling to explain the ongoing rally in risky assets. According to the bears, the stock market is in a clear bubble which is ready to pop!
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Wednesday, March 14, 2012
Global Economic Slowdown Paves Way for QE III / Interest-Rates / Quantitative Easing
By: Michael_Pento
Back in early 2011, I was one of the few economists to warn that global GDP growth would slow dramatically in the near future and that the emerging market economies would not be immune from that upcoming contraction. My prediction was based on the premise that the then incipient sovereign debt crisis in the developed world would cause the export-driven BRIC economies to stall. We now know that the Japanese economy is contracting, while Europe's GDP is falling off a cliff. And just last week we received more concrete evidence that emerging market economies are starting to feel the pinch from the developed world's debt crisis.
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Monday, March 12, 2012
Get Ready to be Disappointed With "Sterilized" QE3 / Interest-Rates / Quantitative Easing
By: Ashvin_Pandurangi
The other big "risk on" news last week, aside from a coercive Greek debt restructuring that was completed "successfully" (but will only make Greece's public debts larger and less sustainable), was a rumor that "sterilized QE3" may be launched by the Fed in the near future (as in, at their meeting this week). The original Wall Street Journal piece by Jon Hilsenrath about this "new novel" program contained precious little in the way of details, yet the pundits and the markets obviously love to jump on the irrational bandwagon first and ask questions later. I, for one, am still very skeptical that the Fed is either able or willing to launch further QE this month.
Monday, February 27, 2012
To QE or Not to QE That is The Question / Interest-Rates / Quantitative Easing
By: Tony_Pallotta
The Fed does not like to surprise the markets. They telegraph policy changes well in advance. The coded language of Alan Greenspan has been replaced with plain english and press conferences under Bernanke. The Fed's monetary policy may be questionable but their strategy of being more transparent to the market has improved albeit far from perfect.
Tuesday, February 21, 2012
U.S. Inflation Expectations Forecast No More QE / Economics / Quantitative Easing
By: Tony_Pallotta
If you study the difference between real or inflation adjusted treasury yields as measured by TIPS and nominal or non inflation adjusted yields you come up with inflation expectations. The Fed has specifically referenced this analysis leading up to QE2. In fact the deflationary trend as measured by TIPS in the summer of 2010 was the basis for expanding their balance sheet.
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Wednesday, February 15, 2012
FOMC Meeting: Divided House about Additional Quantitative Easing / Interest-Rates / Quantitative Easing
By: Asha_Bangalore
The minutes of the FOMC meeting of January 24-25 presented a range of opinions about whether further monetary accommodation through asset purchases (QE3) is necessary. At one end of the spectrum, “a few members observed that, in their judgment, current and prospective economic conditions – including elevated unemployment and inflation at or below the Committee’s objective – could initiate the purchases of additional securities before long.” A more qualified position was held by other members who indicated that “such policy action would become necessary if the economy lost momentum or inflation seemed likely to remain below is mandate consistent rate of 2 percent in the medium run.” In stark contrast to these two opinions that suggest an inclination toward additional asset purchases or QE3, on member viewed maintaining the current extent of monetary accommodation more than the near term as “inappropriate.”
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Wednesday, February 15, 2012
The Lesson of "Half-Hearted" QE Money Printing / Interest-Rates / Quantitative Easing
By: Adrian_Ash
Take 40 trillion Yen, add another 22 trillion, and you still aren't doing enough!
SO HOW MUCH quantitative easing is enough quantitative easing?
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Monday, February 13, 2012
What Does the Bank of England Think It's Doing? / Interest-Rates / Quantitative Easing
By: Adrian_Ash
Quantitative easing has not worked as advertised so far. Why push ahead with more...?
"YOU'VE lost control – Bank of England takes over," says the Bank of England's cute little game for school-kids if you let the hot-air balloon you control crash into the ground, rather than happily floating it around the 2.0% annual inflation target.
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Thursday, February 09, 2012
The Fed's Quasi-Fiscal Policies / Interest-Rates / Quantitative Easing
By: David_Howden
The policies that the Fed embarked on in late 2007 are a sharp departure from the old way of performing monetary policy. In fact, it is difficult to state that the Fed is any longer in the business of traditional monetary policy — understood in the United States as aiming for low inflation and smoothed output volatility. A new breed of monetary policies better referred to as "quasi-fiscal" policies has become the norm.
Tuesday, February 07, 2012
The Fed Resumes Printing Money to Monetize U.S. Government Debt / Interest-Rates / Quantitative Easing
By: Casey_Research
Bud Conrad, Casey Research writes: The Federal Reserve recently announced important policy changes after its Federal Open Market Committee (FOMC) meeting. Here are the three most important takeaways, in its own words:
1.The Committee decided today to keep the target range for the federal funds rate at 0 to 1/4 percent and currently anticipates that economic conditions – including low rates of resource utilization and a subdued outlook for inflation over the medium run – are likely to warrant exceptionally low levels for the federal funds rate at least through late 2014.
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Tuesday, February 07, 2012
Ben Bernanke and QE3 / Interest-Rates / Quantitative Easing
By: Michael_S_Rozeff
Ben, if you and the other members of the FRB are thinking of the factors that I shall mention, then you are likely not to do QE3 any time soon. If not, then, on your own grounds of economic thought, I believe that you are making a mistake.
My general argument is that the risks of QE3 outweigh the prospective gains, on your grounds, not mine. (My preference is no central bank and free banking and/or privately produced money and credit, but I am laying that aside in this article.)
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Sunday, January 29, 2012
The Fed's Inflation Target; QE3, QE4, QE5, etc. are in the Queue / Interest-Rates / Quantitative Easing
By: David_Knox_Barker
The U.S. Federal Reserve policy announcement on Tuesday, January 25, 2012 marks an important moment in monetary history. The forecast by a majority of the members of the FOMC for interest rates to hug zero until late 2014 was of interest and points to the FOMC conviction extended global economic stagnation at best, reflecting the long wave forces at work in the global economy. However, more importantly, it was the first time that the U.S. Federal Reserve has clarified its interpretation of its mandate for price stability, i.e. the target for inflation.
Friday, January 27, 2012
Great Green Opportunities from Dangerous Q.E. / Stock-Markets / Quantitative Easing
By: DeepCaster_LLC
“Prior to the 2008 financial crisis, the eight central bank balance sheets were less than 15% the size of world stock markets and falling. In the immediate aftermath of Lehman Brothers’ failure, these eight central bank balances swelled to 37% the capitalization of the world stock market. But keep in mind that the late 2008/early 2009 peak was due to collapsing stock market values combines with balance sheet expansion via ‘lender of last resort’ loans.
“Recently, the eight central banks balance sheets have spiked to 33% of world stock market capitalization. This has come about not by lender of last resort loans, but rather by QE expansion…
“Central banks are ruling markets to a degree this generation has not seen. Collectively they are printing money to a degree never seen in human history.”
Bianco Research 01/25/2012
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Monday, January 09, 2012
Unpredictability Impact on Global Economy, Fed QE3 Won't Produce the Outcomes We Want / Interest-Rates / Quantitative Easing
By: Bloomberg
PIMCO CEO and co-CIO Mohamed El-Erian spoke with Bloomberg Television's Betty Liu, Dominic Chu and Michael McKee about Europe's crisis, the U.S. economy and where to invest safely in this environment.
El-Erian said that the Fed "doesn't have enough policy instruments to deal with the challenges facing the economy" and that QE3 will not work. On investing opportunities, he said that "In the short term, the U.S. dollar is the best place."
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Thursday, December 22, 2011
ECB Rhetoric versus Reality on Money Printing / Interest-Rates / Quantitative Easing
By: Ben_Traynor
This week, the gap between what the European Central Bank says and what it does became very noticeable indeed...
I know they're stolen, but I don't feel bad.
I take that money, buy you things you never had.
'Free Money', from the album 'Horses' by Patti Smith
Monday, December 19, 2011
The Status Of QE3 / Interest-Rates / Quantitative Easing
By: Tony_Pallotta
Aside from countless banks calling for QE3 which one has to wonder if their analysis may be slightly biased for personal gain the question remains will we see QE3.
The November 2010 FOMC statement which launched QE2 made it clear why the Fed was expanding their balance sheet by $600 billion.
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Tuesday, December 06, 2011
Quantitative Easing by the European Central Bank - A Matter of Time? / Interest-Rates / Quantitative Easing
By: Asha_Bangalore
German Chancellor Merkel and French President Sarkozy announced a “comprehensive” agreement today pertaining to new rules to enforce fiscal discipline among members of the eurozone. Essentially, elements of the Maastricht economic criteria (3.0% budget deficit and 60% debt-to-GDP ratio) that had to be met in order to belong to the Euro Club are being enforced once again under new guidelines. An active audit committee to monitor national budgets to prevent profligacy is not part of the agreement, instead member states will be responsible and each will have to enshrine debt limits in their constitution. The European Court of Justice will have the authority to rule if members are not compliant and sanctions will be put in place by a vote of the European Council if members do not meet the fiscal thresholds. Giving new life to old rules, is that a big step?
Wednesday, November 30, 2011
Perpetual Q.E. Without The Billboard, Hyper Monetary Inflation / Interest-Rates / Quantitative Easing
By: Jim_Willie_CB
The US Federal Reserve has fooled a lot of people into believing that the grand monetary pump and debt monetization project has been put on hold. The only thing that changed was their talking publicly about it. The money press has been working to the limit, never stopped. The discussion has been kept quiet, but the machinery still makes a lot of shrill noise. The proof is not movement of lips by central bankers, but the data from the monetary aggregate. The data is compelling in calling them out. The conclusion to reach is that Quantitative Easing has become the norm, the foundation policy, the emergency action to prevent implosion of the US banking system. Hyper monetary inflation is the New Normal.
Tuesday, November 29, 2011
ECB Expected to Unleash QE Money Printing after Launching of Euro-Bonds / Interest-Rates / Quantitative Easing
By: Gary_Dorsch
Hardly a week goes by, without a major summit between German Chancellor Angela Merkel and French President Nicolas Sarkozy, trying to devise another clever scheme to save the Euro. Yet after 1-½ years of trying to contain the wildfire, - the Euro-zone's debt crisis is more dangerous than ever. The collapse of Greece's €360-billion bond market, now trading at 26% of face value, has triggered contagion sales from periphery of the Euro-zone - Greece, Ireland and Portugal, and into the next upper tier of the Euro-zone, namely, the bond markets of Spain and Italy, which together owe €3-trillion of debt.
Sunday, November 20, 2011
Euro-zone Will Print or Perish / Interest-Rates / Quantitative Easing
By: John_Mauldin
Europe is again at center stage. At conferences and meetings and in private conversations, it is the topic of the hour. I have thought a lot this week about Europe and its impact, so once again we delve into what is an evolving situation. This time, we look at possible impacts on the markets, as we ponder the questions, “Are we back to 2008?” and “Is there a Lehman in our future?” and I try once again to keep from making this a book-length letter. And I close with some brief thoughts I brought back from DC on the Super Committee and the deficit cuts.