From Zero Hedge:
The second half of 2012 saw a significant shift in U.S. monetary policy from calendar-based guidance to outcome-based guidance and the adoption of a 6.5% unemployment rate as a threshold for ‘tapering.’
With Friday’s better-than-expected payroll data and another tick lower in the critical-to-liquidity unemployment rate, it seems Goldman Sachs (and others) are waking up to the facts that we have been vociferous about: the shift of jobless individuals [...]
The librarians at the new George W. Bush presidential center should buy this book on Amazon: The Great Recession: Market Failure or Policy Failure by Robert Hetzel. The author, a Richmond Fed economist, persuasively argues the nasty downturn and ensuing Financial Crisis were caused by the Federal Reserve’s overly tight monetary policy in 2008. The Great Recession was a minor replay of the Great Depression, which most economists also blame on the Fed [...]
London Gold Market Report
from Ben Traynor
Wednesday 27 February 2013, 07:30 EST
Fundamentals “Still Supporting Gold” as Bernanke Testimony “Shows QE Has Long Way to Go”
U.S. DOLLAR gold bullion prices fell slightly in Wednesday morning’s London trading, but held above the $1600 per ounce level it rallied above yesterday after Federal Reserve chairman Ben Bernanke told Congress that that Fed’s ongoing quantitative easing policy “is providing important support to the recovery” and that the [...]
By The Doc
*Fed hints at more QE as economic recovery paused due to Hurricane Sandy
*QE to continue as long as unemployment remains above 6.5%
*Federal funds rate will remain at zero-.25% as long as unemployment remains above 6.5%
*The Committee will closely monitor incoming information on economic and financial developments in coming months. If the outlook for the labor market does not improve substantially, the Committee will continue its purchases of Treasury and [...]
London Gold Market Report
from Ben Traynor
Friday 11 January 2013, 12:15 EST
“Campaign Against Gold Has Failed” Says Central Bank Think-Tank, Rally fades in Gold and Silver
WHOLESALE gold bullion prices dipped back below $1670 an ounce Friday morning in London, 0.9% up on where it started the week, after jumping 1% yesterday following the European Central Bank’s decision to leave interest rates on hold, which was also followed by gains for the Euro.
Silver meantime [...]
As we begin 2013, we reflect on some economic predictions that never came true. After the Fed’s unprecedented actions in 2008, some predicted massive double digit inflation by now. Yet headline consumer price inflation, as of November 2012, was below 2 percent. And as for inaccurate predictions, the Federal Reserve’s expectations of growth over the past 10 years have greatly overstated actual growth. These inaccurate predictions are now the basis for Fed [...]
from Capital Account:
It’s Federal Reserve Interest Rate Decision day! As expected, the Fed announced it will expand its bond-buying program with 45 billion dollars a month in longer-term treasury securities, after the conclusion of Operation Twist at the end of this year. In a different sort of twist, the Fed also announced it is now tying interest rate guidance to economic guide posts.
The FOMC released a statement announcing that they anticipate [...]
Stocks rallied and commodities rebounded from a seven-week low as Spain pledged to cut its deficit and speculation grew that China’s government will do more to support economic growth. The dollar and Treasurys fell.
The MSCI All-Country World Index (MXWD) climbed 1 percent at 2:42 p.m. in New York, rebounding from its biggest drop since July. The Standard & Poor’s 500 Index advanced 1.1 percent, halting a five-day slump, and [...]
Live Stream - Lower right corner of the site, click “Live Webcasts”
Congressman Ron Paul, Chairman of the Domestic Monetary Policy and Technology Subcommittee, announced today that the subcommittee will hold a hearing to examine the effects of the Federal Reserve’s interest rate policy on the American people. The hearing, entitled “The Price of Money: Consequences of the Federal Reserve’s Zero Interest Rate Policy,” will be held on Friday, September 21st, at [...]
The Federal Reserve said it will expand its holdings of long-term securities with open-ended purchases of $40 billion of mortgage debt a month in a third round of quantitative easing as it seeks to boost growth and reduce unemployment.
“If the outlook for the labor market does not improve substantially, the committee will continue its purchases of agency mortgage-backed securities, undertake additional asset purchases and employ its other policy tools [...]
Just six months ago, money market traders expected the Federal Reserve to raise interest rates by the end of 2013. Now, they see borrowing costs staying at record lows for about three more years as the economic outlook worsens.
Bond market measures from overnight index swaps, which indicate no increase in the federal funds rate until mid-2015, to a 62 percent decline in a measure of volatility in government bonds signal that rates will stay near zero for longer. The gapbetween [...]
The market is not amused…
*BERNANKE SAYS STAGNATION IN LABOR MARKET IS `GRAVE CONCERN’
*BERNANKE SAYS FED WILL BOOST ACCOMMODATION AS NEEDED FOR GROWTH
*BERNANKE SAYS HE WOULDN’T RULE OUT FURTHER ASSET PURCHASES
*BERNANKE: QE `SIGNIFICANTLY LOWERED LONG-TERM TREASURY YIELDS’
*BERNANKE SAYS IMPACT OF QE IS `ECONOMICALLY MEANINGFUL’
*BERNANKE: BIG BOOST IN QE MAY REDUCE CONFIDENCE IN SMOOTH EXIT
Ben Bernanke’s Jackson Hole speech is out.
The full speech is below
Monetary Policy since the Onset of the [...]
Charles Evans, President of the Federal Reserve Bank of Chicago, proposed in a speech today that the Fed adopt a monetary policy that is tied to specific economic data points. Specifically, he called for the Fed to not raise the federal funds rate until the U.S. unemployment rate falls below 7%.
“Knowing that rates would stay low until significant progress is made in reducing unemployment would reassure markets and the public [...]
Many of the predictions from 2008-2009 are coming true. Many said that QE would keep going on and on until the system can no longer take it.
Many Federal Reserve policy makers said additional stimulus would probably be needed soon unless the economy shows signs of a durable pickup, according to minutes of their most recent meeting.
“Many members judged that additional monetary accommodation would likely be warranted fairly soon unless [...]
By Irwin Kellner, MarketWatch
Since low interest rates haven’t worked, how about higher rates?
Now don’t get me wrong. I am not talking about tight money.
I don’t want the Federal Reserve to start shrinking the money supply. That would repeat the mistakes made by the central bank in the 1930s, which led to deflation and a severe contraction in economic activity.
What I am talking about is different — [...]
From The Onion:
Following a two-day meeting to discuss the country’s continually disappointing employment numbers, officials from the Federal Reserve announced Friday that if jobs are really meant to be with the American people, they’ll return of their own volition.
“Listen, if it’s meant to be, it’ll happen,” said Fed Chairman Ben Bernanke, adding that there’s no point in purchasing new mortgage-backed securities or keeping the federal funds rate near zero percent [...]
BOE Holds Rates At 0.50%, No Increase To QE Program
A cautious Federal Reserve on Wednesday said that the economy was weaker but took no new action to help stimulate demand.
The lack of any policy action was a surprise. Analysts had expected the Fed to at least push out its pledge to hold its benchmark federal funds rate exceptionally low. Instead, the Fed repeated that it would likely hold that [...]
From Zero Hedge:
1. The Federal Open Market Committee announced no new policy measures today and made only a few small — but important — changes to its policy statement. In particular, guidance that “economic conditions… are likely to warrant exceptionally low levels for the federal funds rate at least through late 2014″ was unchanged, and no new asset purchase or other programs were announced. Once again, Richmond Fed President [...]
NO CHANGE. STOCKS FALLING. DOLLAR RISING. HAWKISH. NO HELP FOR MARKETS!!!
WASHINGTON (MarketWatch) — The Federal Reserve on Wednesday downgraded its view on the economy but otherwise didn’t make make any changes to its key interest rate, low-rate pledge, or asset-buying plans. The Federal Open Market Committee now says “economic activity decelerated somewhat over the first half of the year,” vs. a prior description of saying the “economy has been expanding [...]
by John Galt
June 7, 2012 05:15 ET
So what keeps an academic figurehead for the world’s elite banksters up at night?
A repeat of the 2008 debacle. Thus far they think they have avoided it in the United States however that creeping feeling that the disaster de jour in Europe will not be avoided is starting to permeate the thought processes of our bankers and that means the U.S. taxpayer must be [...]
by Phoenix Capital Research
Talk of QE and rumors of coming Central Bank Intervention pushed stocks and Gold higher on Monday. It’s odd to hear these rumors when every major Central Bank has in fact been clearly stating NO new stimulus is coming any time soon.
Indeed, as the Fed has proved now for eight consecutive FOMC meetings, it is not going to announce more QE unless another systemic Crisis erupts. Instead [...]
A series of 25 basis point increases in the Fed rate would help to create downward pressure on overly valued commodities shares and may actually end up boosting employment.
The notion that higher interest rates will reduce new investment is bogus. We live in a demand based economy and the only way to spur consumer demand is to force down commodities valuations so consumers have money to spend on something besides [...]
Gold’s London AM fix this morning was USD 1,648.25, EUR 1,246.22, and GBP 1,017.88 per ounce. Yesterday’s AM fix was USD 1,641.25, EUR 1,241.49 and GBP 1,019.54 per ounce.
Silver is trading at $30.85/oz, €23.45/oz and £19.14/oz. Platinum is trading at $1,563.00/oz, palladium at $658.75/oz and rhodium at $1,350/oz.
After moves down and then up, gold finished $2.60 or 0.16% higher in New York yesterday and closed at $1,643.80/oz. Gold fell some [...]
3) Possible Statement Changes. The FOMC met last month, and the economic data has been a little weaker since the March meeting – so the statement will probably be slightly more downbeat than the March statement.
As an example, the first two sentences in March might be changed slightly. From the March statement:
Information received since the Federal Open Market Committee met in January suggests that the economy has been expanding moderately. [...]
NEW YORK (CNNMoney) — The Federal Reserve sounds a bit more upbeat about the job market and the global economy, but still the central bank is erring on the side of caution.
Following a meeting on Tuesday, the Fed’s key policymaking committee voted to make no changes to its ongoing stimulus programs.
he central bank still plans to keep the federal funds rate at record lows “at least through late 2014.” The [...]
Dr. Ron Paul
January 31, 2012
The Federal Reserve’s interest rate price-setting board, the FOMC, met last week. They will continue to set the federal funds rate at well below 1%, and plan to keep it low until the end of 2014. That’s a year and half longer than they planned when they met just last month. Chairman Bernanke says they are keeping interest rates so low for so long because the [...]