Tag Archive: negative rates

FX Daily, May 21: Markets Pull Back after Flirting with Breakouts

Overview: New two and a half month highs in the S&P 500 yesterday failed to have much sway in the Asia Pacific region and Europe today as US-China tensions escalate and profit-taking set in. Perhaps it is a bit of "buy the rumor sell the fact" type of activity on the back of upticks in the preliminary PMI reading and hesitancy about pushing for what appeared to be breakouts.

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FX Daily, May 18: Yuan Slumps as US-Chinese Tensions Rise

Overview: Despite somber warnings that the US economic recovery can stretch to the end of next year, investors have begun the new week by taking on new risks. Most equity markets in the Asia Pacific region rose, with Australia leading the large bourses with a 1% gain. India was an outlier, suffering a 2.4% loss, and Taiwan's semiconductor sector was hit, and the Taiex fell 0.6%.

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FX Daily, May 14: Risk Appetites Wane

Overview: Risk appetites have been gradually waning this week. US equity losses mounted yesterday after Tuesday's late sell-off. Asia Pacific equities were off, with many seeing at least 1.5% drops. Europe's Dow Jones Stoxx 600 is off a little more to double this week's decline and leaves it in a position to be the biggest drop since panicked days in mid-March.

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FX Daily, May 8: Jobs and Negative Fed Funds Futures

Overview: The S&P 500 closed near its session lows for the third day running yesterday but failed to deter the bulls in Asia-Pacific, where most markets rose by more than 1%.  Taiwan, Korea, and Australia lagged a bit though closed higher. Europe's Dow Jones Stoxx 600 is firm, and the modest gains (~0.5%) would be enough to ensure a higher weekly close if it can be maintained. 

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FX Daily, March 26: Rumor Bought, Fact Sold

Overview: Speculation that the US Senate would pass the large stimulus bill worth around 10% of US GDP is thought to have fueled a bounce in equities in recent days. The bill was approved and will now go to the House, where a vote is expected tomorrow. If the rumor was bought, the fact has been sold. The first to crack was the Asia Pacific region.

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FX Weekly Preview: China Returns, ECB Record, Fed Minutes and the Week Ahead

Many high-income countries experienced little growth but strong price pressures in the 1970s. Since the mainstream economics said the two were mutually exclusive, a new term had to be created, hence stagflation.  Fast forward almost half a century later, and mainstream economists are still having a problem deciphering the linkages between prices and economic activity, such as inflation and employment.

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How Is Negative Interest Possible? Report 8 Sep

Germany has recently joined Switzerland in the dubious All Negative Club. The interest rate on every government bond, from short to 30 years, is now negative. Many would say “congratulations”, in the belief that this proves their credit risk is … well … umm … negative(?) And anyways, it will let them borrow more to spend on consumption which will stimulate … umm… well… all of the wasteful consumption for which governments are rightly...

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Hard Assets In An Age Of Negative Interest Rates

Time is the soul of money, the long-view - its immortality. Hard assets are forever, even when destroyed by the cataclysms of history. It is the outlook that perpetuated the most competent and powerful aristocracies in continental Europe, well up through World War I and, in certain prominent cases, beyond; it is the mindset that has sustained the most fiscally serious democratic republic in the Western world, that of Switzerland.

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Negative Rates: The New Gold Rush… For Gold Vaults

Negative interest rates and the populist uprising that spurred the UK to vote for Brexit and Americans to elect Trump has helped reignite a rush into physical safe haven assets like gold and silver, which however has led to a shortage of safe venues where to store the precious metals (unlike bitcoin, gold actually has a physical dimension).

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Fed GDP Projections

“It is not surprising the Fed once again failed to take action as their expectations for economic growth were once again lowered. In fact, as I have noted previously, the Federal Reserve are the worst economic forecasters on the planet.

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Weekend Reading: Another Fed Stick Save, An Even Bigger Bubble

As I noted on Thursday, the Fed non-announcement gave the bulls a reason to charge back into the markets as “accommodative monetary policy” is once again extended through the end of the year. Of course, it is not surprising the Fed once again failed ...

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Cash in a box catches on as Swiss negative rates bite

It’s a sign the world is getting used to negative interest rates when what once seemed bizarre starts looking like the norm. Consider Switzerland, where more and more companies are taking out insurance policies to protect their cash hoards from theft or damage.

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Weekend Reading Negative Rates: The Coin Flip Market

As summer begins to fade, and kids return to school, the focus once again turns to the annual event of Central Bankers in Jackson Hole, Wyoming. However, if you only looked at the market as a gauge as to the excitement of the event, well it must have been one pretty boring after-party.

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Going Dutch? Netherlands Joins The 10Y NIRP Club

For the first time in Dutch history, 10Y government bond yields have turned negative (-0.001% intraday) closing at 0.00%... Joining Switzerland, Japan, Germany, and Denmark... Pushing Global NIRP bonds over the $13 trillion!

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Spain Sells 3x Oversubscribed 50-Year Bond

Following a scramble by European nations to issue ultra long-dated government paper, which saw France and Belgium sell 50-year bonds last month, while Ireland and Belgium went all the way and issued century bonds, with even Switzerland locking in 42-...

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Buffett: I Might Consider Taking Money Out of Banks If They Charge for Deposits

With persistently low interest rates around the globe, billionaire investor Warren Buffett told CNBC on Monday he’d consider taking money out of banks, especially if negative interest rates result in customers being charged to park their money in accounts.

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Gold and Negative Interest Rates

  The Inflation Illusion We hear more and more talk about the possibility of imposing negative interest rates in the US. In a recent article former Fed chairman Ben Bernanke asks what tools the Fed has left to support the economy and inter alia discu...

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SNB Monetary Policy Assessment and Critique

We examine the SNB monetary assessment statement of March 17 and the Swiss economy. We explain why negative rates may be a "toothless measure" if a central bank wants to weaken a currency. They have rather an inexpected consequence, they slow down GDP growth, in particular for banks and pension funds.

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(3.3) FAQ: The Why and What For of BOJ’s Negative Interest Rates



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