{"id":30850,"date":"2018-02-11T15:35:55","date_gmt":"2018-02-11T20:35:55","guid":{"rendered":"http:\/\/olduvai.ca\/?p=30850"},"modified":"2018-02-11T15:35:55","modified_gmt":"2018-02-11T20:35:55","slug":"dont-expect-a-central-bank-bailout-this-time-ecbs-nowotny-warns","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=30850","title":{"rendered":"Don’t Expect A Central Bank Bailout This Time, ECB’s Nowotny Warns"},"content":{"rendered":"
\n

Don’t Expect A Central Bank Bailout This Time, ECB’s Nowotny Warns<\/a><\/span><\/h3>\n<\/div>\n
\n
\n
\n
\n

To all those hoping for a sign or signal from central bankers that the recent correction in US stocks was necessary and sufficient <\/strong><\/em>for intervention, here are some disappointing examples of what they have said recently:<\/p>\n

“If stock prices or asset prices more generally were to fall, what would that mean for the economy as a whole?” asked outgoing Fed Chair Yellen during her exit interview, selling the all-time highs. “The financial system is much better capitalized. The banking system is more resilient,” <\/strong>the former US central banker added, listing her accomplishments. “I think our overall judgment is that, if there were to be a decline in asset valuations, it would not damage unduly the core of our financial system.”<\/strong><\/p>\n

That was that moment when the “Yellen Put” instantly vanished, and stocks – predictably – plunged, while the industry\u2019s most obviously ill-conceived financial innovations \u2013 inverse VIX ETFs – collapsed to essentially zero in the space of thirty minutes on the first day of new Fed chair’s Jay Powell tenure.<\/p>\n

* * *<\/p>\n

“I think it\u2019s basically a market event, and these things can be healthy,” <\/strong>stated Dallas Fed president Robert Kaplan, diagnosing Monday\u2019s -4.1% S&P 500 epileptic fit. “I don\u2019t think it will have economic implications. 2018 will be a strong year in America. We\u2019re at or near full employment. I continue to expect three rate hikes this year,” <\/strong>explained the former Goldman banker.<\/p>\n

* * *<\/p>\n

“This is the most predicted selloff of all time because the markets have been up so much and they have had so many days in a row without meaningful down days,\u201d <\/strong>said Philly Fed president Bullard. “Something that has gone up 40% like the S&P tech sector would at some point have a selloff.” <\/strong>he added philosophically.<\/p>\n

…click on the above link to read the rest of the article…<\/p>\n<\/div>\n<\/div>\n<\/article>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

Don’t Expect A Central Bank Bailout This Time, ECB’s Nowotny Warns To all those hoping for a sign or signal from central bankers that the recent correction in US stocks was necessary and sufficient for intervention, here are some disappointing examples of what they have said recently: “If stock prices or asset prices more generally […]<\/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":[124,233,282,303,534,7621,3650],"class_list":["post-30850","post","type-post","status-publish","format-standard","hentry","category-economics","tag-central-banks","tag-ecb","tag-european-central-bank","tag-fed","tag-monetary-policy","tag-nowotny","tag-us-federal-reserve"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/30850","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=30850"}],"version-history":[{"count":1,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/30850\/revisions"}],"predecessor-version":[{"id":30851,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/30850\/revisions\/30851"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=30850"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=30850"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=30850"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}