Analysis Topic: Interest Rates and the Bond Market
The analysis published under this topic are as follows.
Monday, August 20, 2007
The Reserve Bank of Australia gets it Wrong on Financial Markets / Interest-Rates / Global Financial System
By: Gerard_Jackson
Last week the Reserve Bank of Australia raised interest rates. Glenn Stevens, the Reserve's governor, told the house of representatives standing committee on economics, finance and public administration that he did not regret the decision. He said: “It has been a little bit difficult to read what the current trend in inflation is over recent quarters”. Let me see if I can help out here. Inflation, Mr Stevens, is a monetary expansion.Read full article... Read full article...
Monday, August 20, 2007
Lower US Interest Rates from the Fed are Not Likely / Interest-Rates / US Interest Rates
By: Hans_Wagner
Everyone seeking to beat the market from James Cramer to Wall Street big wigs are crying out for the U.S. Federal Reserve to lower the Fed Funds rate, the rate banks can borrow from each other. They believe that it will save the markets and help the firms recover from the mis-pricing of so many mortgage loans. However the Fed is not likely to lower rates in the near terms since inflation still looms on the horizon. After all fighting inflation is one of the primary missions of the Fed. Read full article... Read full article...
Monday, August 20, 2007
US Interest Rate Cut - Bernanke Blinks First / Interest-Rates / Credit Crunch
By: Andy_Sutton
Occasionally, on dark, secluded back streets, adolescents and other not so tightly wrapped folks engage in a classic American rite of passage known as 'Chicken'. The idea behind the game is for two cars to drive directly towards each other at a high rate of speed and see who swerves first. That person is dubbed the chicken. Obviously, it is easy to envision what happens if neither driver blinks.
For approximately the past two weeks financial commentators and observers have been watching a variant of this classic game. The markets, roiled in certainly the biggest blow-off since the end of the tech bubble, and perhaps of all time were screaming madly for the Fed to step in and open the discount window. CNBC host and industry shill Jim Cramer almost brought on a stroke screaming that Bernanke "doesn't know how bad it is out there!" On the other side was the Fed, stalwart, poised and resolute. Something had to give...
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Sunday, August 19, 2007
Prime Interest Rates and the Market Value of Gold / Interest-Rates / US Interest Rates
By: Greg_Silberman
Before the Feds Emergency rate cut on Friday the bias was to higher rates across the board. For example the Australian Reserve Bank increased prime interest rates by 0.25% and even now after the stock market pummeling, continues to warn of more to come. This article explains why interest rates are about to go higher at exactly the WORST possible time.The question foremost on investors minds is whether a turbulent stock market warrants halting interest rate increases or, in the case of the US, decreasing rates to resuscitate the Real Estate and credit markets.
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Friday, August 17, 2007
US Interest Rate Cut - Relief is Spelt B-E-N / Interest-Rates / US Interest Rates
By: Brady_Willett
Yen carry is blowing up, global stock prices are in mini-crash mode, and the financial meltdown is threatening to spark an economic meltdown. Having gingerly danced with rhetoric and liquidity injections in recent days, the Fed started to boogie this morning. Here is the statement in its entirety:Read full article... Read full article...
Thursday, August 16, 2007
Effective Fed Funds Rate Cut to 4.75% - Well, bless Poole's Beautiful Hide! / Interest-Rates / US Interest Rates
By: Adrian_Ash
ONLY A "CALAMITY" would justify an interest-rate cut now, says St. Louis Federal Reserve chief William Poole.
In which case, he either liquidated his personal stock investments before June...or the guy's got some real hide.
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Wednesday, August 15, 2007
Ben, If You're Going to Cut US Interest Rates... / Interest-Rates / US Interest Rates
By: Tim_Iacono
Federal Reserve Chairman Ben Bernanke pays pretty close attention to the inflation statistics, so he's probably already figured out that if he's going to cut short-term rates this year, he ought to do it in the next two months.
Just in case he hasn't figured it out already, maybe this explanation will assist in what will likely be a difficult decision-making process.
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Wednesday, August 15, 2007
GOLD THOUGHTS - Federal Reserves Flawed Monetary Policy / Interest-Rates / Inflation
By: Ned_W_Schmidt
Complete and total intellectual bankruptcy of Federal Reserve was confirmed this past week. Creation and collapse of two financial bubbles in eight years would seem to suggest monetary philosophy of Federal Reserve is fatally flawed. Core rate of inflation as a tool for managing monetary policy should be declared dead, and buried in history books of foolish thinking.Read full article... Read full article...
Tuesday, August 14, 2007
Bernanke Grounded-- for Now / Interest-Rates / Credit Crunch
By: Michael_Pento
The head of the Federal Reserve has so far not lived up to his moniker of “Helicopter Ben.” Unlike what his label suggests, Mr. Bernanke has only addressed the current liquidity crisis with system repurchases—which add temporary cash into the system—instead of coupon passes, which are a more permanent infusion of cash. By leaving the Fed Funds target rate at 5.25%, he has differentiated himself from Alan Greenspan, whose playbook response to a crisis was to devalue the currency without hesitation.Read full article... Read full article...
Thursday, August 02, 2007
UK Interest Rates Expected to Stay on Hold at 5.75% Today / Interest-Rates / UK Interest Rates
By: Nadeem_Walayat
The Market Oracle expectations are for the Bank of England to keep interest rates on hold at 5.75% at today's MPC meeting.
Our last analysis (18th July 07) targeted the next rise to 6% to occur at the October 2007 MPC Meeting. More importantly there is increasing probability that 6% will mark a peak for UK interest rates. This is becoming clearer with each passing months economic data on the economy which show a slowing housing market and moderating inflation. Additionally, the series of financial knocks such as the ongoing liquidity squeeze sparked by the failure of Bear Stearns Hedge funds due to excessive positions in the faltering US Subprime mortgage market, are also expected to be taken into account at today's interest rate decision meeting.
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Thursday, August 02, 2007
Hedge Fund Failures is Fire in the Projection Room / Interest-Rates / Financial Crash
By: Tim_Iacono
Many people in high places continue to assert that problems with hedge funds and subprime lending do not pose a systemic risk to the financial system.
If these important people did think the entire financial system was threatened, do you think they would tell us?
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Tuesday, July 31, 2007
Hedge Fund Subprime Credit Crunch to Impact Interest Rates / Interest-Rates / Credit Crunch
By: Nadeem_Walayat
The ongoing crisis triggered by the subprime mortgage defaults continues to spiral into new directions, making it difficult for even experienced market watchers to comprehend the complete picture and its implication for the financial markets. Therefore this article attempts to explain the crisis and what it implies for future interest rate trends.
What are Subprime Mortgages?
These are Mortgages made available to those of subprime credit risk (poor credit histories), hence called sub prime mortgages.
Why would financial institutions lend to people with poor credit histories ?
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Monday, July 30, 2007
Yield on US 10-Year Note Going Lower / Interest-Rates / US Interest Rates
By: Mike_Paulenoff
The yield of the 10-Year Treasury note climbed from 4.73% in March to 5.32% in June, at which point it had surged to a six-year resistance line, implying the potential for much higher rates. It then reversed in a big way and plunged to 4.74% into today's low, mostly in response to flight-to-safety concerns.
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Friday, July 27, 2007
Central Banks Print Money Whilst Money Market Interest Rates Fall / Interest-Rates / Credit Crunch
By: Submissions
KEEPING OUR EYES PEELED FOR THE SILVER AND GOLD BASIS
Setting up the trip-wire
Gamblers shorting the dollar and bonds beware. Rumors about the imminent demise of the dollar and the bond market are grossly exaggerated. Bear in mind not only that the casino owner rigs your odds. He is also rigging the value of chips in which payoffs are made, thereby confusing the issue further.
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Friday, July 27, 2007
Back to Banking Basics - Risk Rating Agencies Assigning AAA to Risky Debt / Interest-Rates / Risk Analysis
By: Adrian_Ash
REMEMBER WHEN banks lent money using the cash deposited with them?
That's how most people still imagine banking works, even today. The banks hope to profit simply by charging more on their loans than they pay out to cash depositors. The art (or science) comes in choosing only the most credit-worthy borrowers, or adjusting the interest rate charged to higher risk debtors accordingly.
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Tuesday, July 24, 2007
Nolte Notes - Sublime to Sub-prime / Interest-Rates / Subprime Mortgage Risks
By: Paul_J_Nolte
The market focus has begun to move from the sublime to sub-prime. Housing was to be well contained, earnings growth (although slowing) was to march inexorably higher and investors mergers and acquisitions were going to (eventually!) remove every stock from the markets. Then Friday happened. Earnings warnings from Caterpillar and a miss by internet giant Google cast doubt about the overall strength of earnings for the quarter.Read full article... Read full article...
Monday, July 23, 2007
Bear Stearns / Subprime Crisis - Looking for Contagion in All the Wrong Places / Interest-Rates / Credit Crunch
By: John_Mauldin
This Week in Outside the Box we Join Bill Gross of Pimco in his July 2007 Investment Outlook as he strives to address the implications of the Bear Stearns hedge fund debacle, the toxic waste that is Wall Streets' innovative derivative products and their respective valuation, rather, lack thereof.Read full article... Read full article...
Friday, July 20, 2007
The State of the Credit Markets / Interest-Rates / Credit Crunch
By: John_Mauldin
In this issue:
Hot Fun In The Summertime
Collateralized Loan Obligations
The Economic Outlook for Leveraged Credits
The New Mickey Mouse Club
Planes, Trains and Automobiles
This week I am already in Maine and getting ready for a weekend of fishing with my son Trey, so I am going to take off a week from writing the letter. I spoke this morning to the Maine chapter of the Chartered Financial Analysts in Portland. The question of the day was about the subprime markets, private equity and the debt markets in general. And these are the right questions, as this is the part of our economic world with the most risk.
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Wednesday, July 18, 2007
UK Inflation CPI Falls But Interest Rates Set to Rise to 6% By October 2007 / Interest-Rates / UK Interest Rates
By: Nadeem_Walayat
Yesterday the 'official' measure of UK inflation the Consumer Price Index (CPI) fell from 2.5% to 2.4%, and thus trending in the right direction towards the 2% target after a scare earlier in the year when the CPI breached the upper limit of 3%, prompting the Governor of the Bank of England to write a letter to the former Chancellor Gordon Brown explaining why the Bank had failed to control inflation.Read full article... Read full article...
Tuesday, July 17, 2007
Bear Stearns Yet to Report Mortgage Bond Losses - Bish, Bosh, Loads of Dosh! / Interest-Rates / Credit Crunch
By: Adrian_Ash
"...Wasn't Bear Stearns supposed to report the losses at its two mortgage-bond hedge funds on Monday this week...?"
"BEAR STEARNS Investors Await Tally on Losses," said the Wall Street Journal two weeks ago. The two-week deadline, set by America 's fifth-largest securities firm itself in an email to investors, came and went yesterday.
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