Tag Archive: Federal Reserve

Janet Yellen Fights the Tide of Falling Interest

The Fed is going to have to take back this interest rate hike (Dec 16). The process that sets the interest rate is complex. I have written many words on its terminal decline. However, there are two simple reasons why the trend remains downward.

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The Dog That Did not Bark

In the famous Sherlock Holmes Story, the detective identified the perpetrator from the fact that a dog didn’t bark. The dog didn’t bark because it dog knew the perp. This story makes a good analogy to what happened on Thursday, Sep 17. Perhaps I should say what did not happen. The Fed did not raise the interest rate.

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The Fed and the Cotton Candy Market

For Keith Weiner the Federal Reserve operates like a Cotton Candy Machine for the housing market. It creates a massive bubble, financed with debt. It spins the price of a house, with the help of credit and debt, into something many times its original size.

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The Gold Standard For Democrats

blue collar guy
Keith Weiner describes how the Fed pushes down the interest rate and due to that, it drives up prices of food and rents. This implies that businesses are clearly priviliged against workers. The gold standard does the opposite, if prefers savings and workers. Hence Democrats should be fan of the gold standard.

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What Drives the Economy: Consumer Spending or Saving/Investment?

saving investment
The concerted actions in September 2012 between the two big central banks reflected two fundamental economic principles: The Fed opted for Keynes' law, the ECB for Say's Law with conditionality. And apparently the ECB was successful.

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US Economic Indicators

US Recession Indicators Concurrent Indicators
The four best US economic indicators, in form of concurrent indicators, can be seen at Doug Short, here in detail.

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(3) Inflation, Central Banks and Interest Rates

PoBC RBA Fed BoE
In this chapter we connect three related concepts: inflation, central banks and interest rates.

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Fed FOMC: Who is Hawk, Who is Dove? 2015 Update

fomc voters 2014 dove / hawk scale, dove centrist hawk
Composition of the Fed's Federal Open Market Committee (FOMC composition), needed to know if the Fed is opting for quantitative easing or not.

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Quantitative Easing, its Indicators and the Swiss Franc

bernanke gold chf, dollar
The main drivers of demand for Swiss francs are the euro crisis and, even more, the behavior of American investors, who go out of the dollar in the fear of bad US economic data and/or Quantitative Easing (QE). Risk-friendly investors move into risky assets like stocks or currencies of emerging markets, while risk-averse investors fear inflation and buy inflation-resistant assets like Swiss francs.

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The Fed Poisons The Stock Market

The Fed has pumped trillions of dollars into the financial system since 2008. The unintended consequences of this bank bailout have spilled over into the markets. Fed money injections go directly into bonds, tending to push up their prices.

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Fundamentals,FX,Gold and CHF:Week November 18 to November 22

2013-11-23

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2013-11-23

FX Price Movements November 11 to November 15 2013
Fundamentals with highest importance: The HSBC Flash Purchasing Manager Index (PMI) for China weakened from 50.8 to 50.4. In particular, new export orders, output prices and employment started to decrease again, while output increased. The preliminary Markit manufacturing PMI for the United States edged up to 54.3 (vs. 52.3 expected), a 9-month high after the …

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Fundamentals,FX,Gold and CHF:Week November 11 to November 15

2013-11-16

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2013-11-16

FX Price Movements November 11 to November 15 2013
Fundamentals with highest importance: In Janet Yellen’s hearing at the Senate Banking Commission, the future Fed chair emphasized the need to provide support to the economic recovery and to overcome low inflation. Her speech supported equities, gold and US Treasuries. GDP in the Euro zone rose by 0.1% QoQ in line with expectations, but less …

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Fundamentals,FX,Gold and CHF: Week November 4 to November 8

2013-11-09

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2013-11-09

November 4 to November 8 Weekly FX Rates
Fundamentals with highest importance: The U.S. GDP release for Q3, showed that despite the recent U.S. critique with Germany, the Americans are trying to follow the successful Germans: for the first time since Q1/2012 and Q2/2011 exports rose more than imports. GDP was up 2.8%, but not driven by consumption, it was mostly helped by …

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Fundamentals,FX,Gold and CHF: Week October 28 to November 3

2013-11-02

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2013-11-02

New Car Sales: Europe vs USA
This week had a focus on – due to the government shut-down – the long awaited U.S. data: Highest importance: The ISM Manufacturing Purchasing Manager Index (PMI) for October came in at 56.4, higher than the 55 expected. The value for new orders and for production remained above 60 despite the government shutdown. The value …

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History of Wrong Forecasts of Fed and Swiss Economists

Aymo Brunetti as pinocchio


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History of Wrong Forecasts by Swiss and Fed Economists: Update September 2013

2013-09-19

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2013-09-19

Aymo Brunetti as pinocchio
Or how to talk down and how to talk up an economy with wrong forecasts   American and Swiss mentalities are very different, the Americans have the tendency not to care about the future a lot, the Swiss, however, do things only after careful consideration of potential risks. This tendency can be proven economically with … Continue reading...

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The List German Gold Transactions 1951-2012

German Gold Transactions Depositaries
The German Bundesbank decided to opt for full transparency of their gold reserves and their whereabouts since the second world war. Our details:

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Recreating the Asset Bubble: The Fed’s Plan for Economic Recovery

2013-02-16

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2013-02-16

U.S. Net Worth Since 1990
The Fed's plan is recreate an asset bubble, so that economic actors have enough time to forget about the latest one and adjust their rational expectations about low future growth to the upside.  Read the Circle...

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The history of wrong forecasts by Swiss economists: details

2013-01-13

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2013-01-13

SECO Estimates for 2009 2010
Or how to talk down an economy with wrong forecasts Read the introductory post here, if you haven’t yet. Details of SECO forecasts   In the following we give the details about the SECO, the Swiss government economic agency’s, forecasts.   Forecast Q1/2009 Sharp recession in 2009, gradual stabilization in 2010 Bern, 17.03.2009 – Economic …

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