{"id":2103,"date":"2014-11-26T16:42:13","date_gmt":"2014-11-26T21:42:13","guid":{"rendered":"http:\/\/olduvai.ca\/?p=2103"},"modified":"2014-11-26T16:42:13","modified_gmt":"2014-11-26T21:42:13","slug":"central-bank-credibility-the-equity-markets-and-gold","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=2103","title":{"rendered":"Central Bank Credibility, the Equity Markets and Gold"},"content":{"rendered":"<p><a href=\"http:\/\/www.forbes.com\/sites\/michaelpollaro\/2014\/10\/12\/central-bank-credibility-the-equity-markets-and-gold\/\">Central Bank Credibility, the Equity Markets and Gold<\/a>.<\/p>\n<p style=\"box-sizing: border-box; outline-width: 0px; outline-style: initial; outline-color: initial; font-size: 18px; vertical-align: baseline; background-image: initial; background-attachment: initial; background-origin: initial; background-clip: initial; background-color: transparent; color: #000000; line-height: 24px; font-family: Georgia, 'Times New Roman', Times, serif; background-position: initial initial; background-repeat: initial initial; padding: 0px; margin: 0px 16.66666603088379% 18px 0px; border: 0px initial initial;\">Central bank credibility is at all-time highs.\u00a0 As a consequence, we suggest, equities are near all-time highs too while gold is scraping multi-year lows. A change though may be in the offing with all three. Not today, nor tomorrow. But perhaps sooner than most think.<\/p>\n<p style=\"box-sizing: border-box; outline-width: 0px; outline-style: initial; outline-color: initial; font-size: 18px; vertical-align: baseline; background-image: initial; background-attachment: initial; background-origin: initial; background-clip: initial; background-color: transparent; color: #000000; line-height: 24px; font-family: Georgia, 'Times New Roman', Times, serif; background-position: initial initial; background-repeat: initial initial; padding: 0px; margin: 0px 16.66666603088379% 18px 0px; border: 0px initial initial;\">Here\u2019s how we see it\u2026<\/p>\n<p style=\"box-sizing: border-box; outline-width: 0px; outline-style: initial; outline-color: initial; font-size: 18px; vertical-align: baseline; background-image: initial; background-attachment: initial; background-origin: initial; background-clip: initial; background-color: transparent; color: #000000; line-height: 24px; font-family: Georgia, 'Times New Roman', Times, serif; background-position: initial initial; background-repeat: initial initial; padding: 0px; margin: 0px 16.66666603088379% 18px 0px; border: 0px initial initial;\">In the context of five plus years of the most unconventional monetary policies the world has ever seen, there is a near universal belief that a group of Keynesian\/Monetarist schooled, largely academic economists have got it all figured out; namely, that super-sized, well-orchestrated, easy money policies \u2013 zero even negative benchmark interest rates, a smorgasbord of essentially free lending programs and of course mega-size asset purchase programs (QE) \u2013 can produce sustainable, economic growth.\u00a0 In other words, central bank credibility and the efficacy of their policies are in the heavens.<\/p>\n<p style=\"box-sizing: border-box; outline-width: 0px; outline-style: initial; outline-color: initial; font-size: 18px; vertical-align: baseline; background-image: initial; background-attachment: initial; background-origin: initial; background-clip: initial; background-color: transparent; color: #000000; line-height: 24px; font-family: Georgia, 'Times New Roman', Times, serif; background-position: initial initial; background-repeat: initial initial; padding: 0px; margin: 0px 16.66666603088379% 18px 0px; border: 0px initial initial;\">No central bank is more revered in this regard than the Federal Reserve.\u00a0 As we discussed\u00a0<a class=\"exit_trigger_set\" style=\"box-sizing: border-box; outline-width: 0px; outline-style: initial; outline-color: initial; font-size: 18px; vertical-align: baseline; background-image: initial; background-attachment: initial; background-origin: initial; background-clip: initial; background-color: transparent; color: #003891; text-decoration: underline; background-position: initial initial; background-repeat: initial initial; padding: 0px; margin: 0px; border: 0px initial initial;\" href=\"http:\/\/www.forbes.com\/sites\/michaelpollaro\/2014\/09\/29\/there-is-no-graceful-exit-for-the-fed-mark-zandi\/\">here<\/a>, the Federal Reserve, it is said, is \u201cpulling it off.\u201d\u00a0 Because of its heroic, unconventional, all-in easy money policies, the Federal Reserve is said to have \u201csaved\u201d America from an almost certain depression and then, because of its continued easy money policies, is the driving force behind America\u2019s now accelerating economic growth. Just look at the economic numbers, say the pundits. The Federal Reserve\u2019s monetary policies are working. Yes, not as fast as we would like, but going in the right direction. Only one task left \u2013 a well-calibrated, data-driven exit from these unconventional policies.\u00a0 The strengthening economy can take it, they say. In fact, the exit should be welcomed because it signals a strong and growing economy, one that will no longer require any Federal Reserve support.<\/p>\n<p style=\"box-sizing: border-box; outline-width: 0px; outline-style: initial; outline-color: initial; font-size: 18px; vertical-align: baseline; background-image: initial; background-attachment: initial; background-origin: initial; background-clip: initial; background-color: transparent; color: #000000; line-height: 24px; font-family: Georgia, 'Times New Roman', Times, serif; background-position: initial initial; background-repeat: initial initial; padding: 0px; margin: 0px 16.66666603088379% 18px 0px; border: 0px initial initial;\">&#8230;click on the above link to read the rest of the article&#8230;<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Central Bank Credibility, the Equity Markets and Gold. Central bank credibility is at all-time highs.\u00a0 As a consequence, we suggest, equities are near all-time highs too while gold is scraping multi-year lows. A change though may be in the offing with all three. Not today, nor tomorrow. But perhaps sooner than most think. Here\u2019s how [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[2],"tags":[122,1450,374,661,662],"class_list":["post-2103","post","type-post","status-publish","format-standard","hentry","category-economics","tag-central-bank","tag-equity-markets","tag-gold","tag-qe","tag-quantitative-easing"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/2103","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=2103"}],"version-history":[{"count":1,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/2103\/revisions"}],"predecessor-version":[{"id":2104,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/2103\/revisions\/2104"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=2103"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=2103"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=2103"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}