Tag Archive: Interest rates

Demographics and a New Old Paradigm

2016-10-23

The hangover from the debt crisis and secular stagnation are the two main explanatory models for the low growth and low interest rates. Anew Fed paper brings the focus back to demographics. If true, warns of a protracted period of slow growth, low interest rates.

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Canadian Dollar: A Little Less About Oil, a Little More about Rates

2016-10-06

by Marc Chandler

2016-10-06

The Canadian dollar's link to oil has loosened. Its sensitivity to interest rates has increased. Lumber issue is coming to a head shortly.

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Natural Rates and Terminal Fed Funds

2016-08-30

by Marc Chandler

2016-08-30

The neutral or natural interest rate is linked to potential growth. Potential growth has fallen so has the neutral rate. The implication is that the FOMC has made the bulk of the adjustment on its long-term Fed funds forecast.

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Falling Yields, Rising Asset Prices -Rising Yields,Falling Prices

Our paper currency causes falling productivity, though not in terms of bushels per acre. What falls is productivity per dollar or euro of savings. This is the real meaning of the falling interest rate. When the rate was 10 percent, $1,000 of principal produced $100 of return. When it falls to two percent, then the same capital generates a return of only $20. Now with the Swiss 10-year bond, CHF 1,000 earns only CHF 1.3. Keith Weiner argues that one...

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The Gold Standard For Democrats

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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Business Cycles

The typical backstops of all improvements in business cycles are high oil prices and inflation. Inflation is mostly caused by local effects.

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Our Core Thesis

Hans Werner Sinn has formulated his critique with Piketty. Sinn says that: r ≠ i > g, hence Interest rates i are usually higher than economic growth g, but r is not the same as i. Hence r can be higher or lower than g.

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Danthine: SNB would end franc cap once it raises interest rates

2013-08-11

by George Dorgan

2013-08-11

Jean Pierre Danthine Swiss National Bank SNB

It was obvious already at the latest SNB Monetary Policy Assessment, the SNB is becoming more and more hawkish. At the forefront is its ueber-hawk Jean-Pierre Danthine, the person responsible for the overheating Swiss housing market. He has now announced: SNB would end franc limit once it raises interest rates The Swiss National Bank will …

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