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Tag Archives: central banks
Algeria Officially Launches Helicopter Money Amid Sliding Oil Revenue, Budget Crisis
Algeria Officially Launches Helicopter Money Amid Sliding Oil Revenue, Budget Crisis One year ago, the imminent arrival of helicopter money among endless discussions of pervasive lowflation was all the rage within high-finance policy circles. Then, everything changed as if on a dime, and in recent months the dominant topic has been global coordinated tightening – […]
“Bad Options” Regarding 2% Inflation Targets (And Other Silly Notions)
“Bad Options” Regarding 2% Inflation Targets (And Other Silly Notions) The Wall Street Journal and Bloomberg both posted ridiculous articles regarding today regarding inflation. The former was on “bad options” the latter on “inflation expectations”. Let’s take a look at both articles because both represent widely believed nonsense. In Bad Options for Addressing Too-Low Inflation, Wall […]
Money Multiplier is Really About Credit Out of “Thin Air”
MONEY MULTIPLIER IS REALLY ABOUT CREDIT OUT OF “THIN AIR” According to traditional economics textbooks, the current monetary system amplifies the initial monetary injections of money. The popular story goes as follows: if the central bank injects $1 billion into the economy and banks have to hold 10% in reserve against their deposits the initial […]
Bill Blain: “This Is What Terrifies Draghi And Other Central Bankers”
Bill Blain: “This Is What Terrifies Draghi And Other Central Bankers” Austria 2% for 100 year bond will go down as “financial moment”. Wake up and smell the coffee of economic reality Blain’s Morning Porridge – September 13th 2017 “Hey Satan, paid my dues, playing in a rocking band…” This morning dawns bright and hopeful. […]
Housing Bubble Symmetry: Look Out Below
Housing Bubble Symmetry: Look Out Below Housing markets are one itsy-bitsy recession away from a collapse in domestic and foreign demand by marginal buyers. There are two attractive delusions that are ever-present in financial markets: One is this time it’s different, because of unique conditions that have never ever manifested before in the history of […]
Weekend Reading: The “Real” Vampire Squid
Weekend Reading: The “Real” Vampire Squid First, it was Hurricane “Harvey” and an expected $180 billion in damages to the Texas coastline. Now, “Irma” is speeding her way to the Florida coastline dragging “Jose” in her wake. Those two hurricanes, depending on where they land will send damages higher by another $100 billion or more […]
Central Banks Have Purchased $2 Trillion In Assets In 2017
Central Banks Have Purchased $2 Trillion In Assets In 2017 In his latest “flow report”, BofA’s Michael Hartnett looks at the “Disconnect Myth” between rising stocks and bonds and summarizes succinctly that there is “no disconnect between stocks & bonds.” Why? The best, and simplest, explanation for low yields & high stocks is simple: so […]
See No Evil, Speak No Evil…
SEE NO EVIL, SPEAK NO EVIL… The Jackson Hole speeches of Janet Yellen and Mario Draghi last week were notable for the omission of any comment about the burning issues of the day: …where do the Fed and the ECB respectively think America and the Eurozone are in the central bank induced credit cycle, and […]
Central Bankers’ Shifting Goalposts
Central Bankers’ Shifting Goalposts BRUSSELS – The theme of this year’s meeting of the world’s central bankers in Jackson Hole, Wyoming, had little to do with monetary policy. “Fostering a Dynamic Global Economy” is, of course, an important topic. But it is telling that the European Central Bank chose, for its own annual gathering, a […]
The Insanity of Pushing Inflation Higher When Wages Can’t Rise
The Insanity of Pushing Inflation Higher When Wages Can’t Rise In an economy in which wages for 95% of households are stagnant for structural reasons, pushing inflation higher is destabilizing. The official policy goal of the Federal Reserve and other central banks is to generate 3% inflation annually. Put another way: the central banks want to […]
BofA: Even The Bubbles Are Becoming More “Bubbly” Thanks To Central Banks
BofA: Even The Bubbles Are Becoming More “Bubbly” Thanks To Central Banks Back in June, Citi’s credit strategist Hans Lorenzen pointed out that while QE had failed to spark inflation across the broader economy, it had achieved something else: “the principal transmission channel to the real economy has been… lifting asset prices.” That however has […]
Total G-3 Central Bank Control – Craig Hemke
Total G-3 Central Bank Control – Craig Hemke There’s a lot of amazement and wonder at how the “stock market” can be up today with the devastating news out of Texas and the latest North Korean missile launch. Longtime readers of TFMR know exactly how this market levitation is accomplished so this post is […]
The Bond Bubble
The Bond Bubble Central banks have artificially lowered interest rates, making bonds attractive. And since bonds are historically safe havens, it’s hard to even comprehend a bond bubble. But as interest rates start to rise, the concern over bonds rises too. Adding some gasoline to the fire is the fact that the largest buyers of […]
Rogoff Tells Central Banks More Negative Interest Rates Will Be Needed
Rogoff Tells Central Banks More Negative Interest Rates Will Be Needed Kenneth Rogoff, the Professor of Economics at Harvard University, is stuck in a time warp where he cannot think out of the box even once. He is telling the central banks that the next recession they will have to resort to negative interest rates and […]
How Central Banking Increased Inequality
How Central Banking Increased Inequality Although today high levels of inequality in the United States remain a pressing concern for a large swath of the population, monetary policy and credit expansion are rarely mentioned as a likely source of rising wealth and income inequality. Focusing almost exclusively on consumer price inflation, many economists have overlooked […]
