Category Archives: Monetary Policy

The Automatic Tapering Of Quantitative Tightening

Posted on January 9, 2019 by macromon

We heard a market pundit today mention the Fed will soon begin to taper its reduction in the balance sheet.  The pundit seemed convinced the balance sheet reduction is on track to total $600 billion per year as far as … Continue reading →

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Fed Balance Sheet Run-Off Is Smaller Than Caps

Posted on January 6, 2019 by macromon

We’re not sure if we heard Chairman Powell clarify the total balance sheet run-off for 2019, which is important as the pundits are throwing around a number a $600 billion reduction.   Completely false. We project the total run-off in 2019 … Continue reading →

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Do You Believe In Omens?

Posted on December 18, 2018 by macromon

After finishing my last post earlier tonight on how we may be misdiagnosing the ails of the market, I had this strange episode where I couldn’t breathe.  I really thought it was lights out. Last month I had a pain … Continue reading →

Posted in Monetary Policy, Uncategorized | Tagged | 10 Comments

Inflation With A Draghi Tatoo?

Posted on December 13, 2018 by macromon

Draghi: QE is part of our toolbox and can be considered to be useable by the Governing Council in contingencies. We’ve always considered this and it has now been sanctioned by the ECJ — European Central Bank (@ecb) December 13, … Continue reading →

Posted in Banking, Monetary Policy, Uncategorized | Tagged , , , , | 2 Comments

Time To Tune Out Market Pundits

Posted on December 4, 2018 by macromon

Fugly day in the stock market. We had to post a response to the market punditry rationalization on why stocks accelerated downward today: “the S&P500 broke its 200-day moving average.“ Are you fricking kidding me? The S&P500 has been under … Continue reading →

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The S&P Levels You Need To Know

Posted on December 3, 2018 by macromon

Interesting double-top, double bottom W forming in the S&P500.   In honor of George H.W. and George W.?  Hmmm…… The futures were rejected right at key resistance in overnight trading, making a high at 2814.0 during in early morning pre-trading and … Continue reading →

Posted in China, Equities, Interest Rates, Monetary Policy, Uncategorized | Tagged , , , , | 17 Comments

Mr. Market Goes Full Powell-Wow Over Fed Chair’s Cave

Posted on November 29, 2018 by macromon

He caved.  At least in rhetoric. Interest rates are still low by historical standards, and they remain just below the broad range of estimates of the level that would be neutral for the economy‑‑that is, neither speeding up nor slowing … Continue reading →

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The Lessons of Quantitative Easing | Stephen Roach

Posted on November 19, 2018 by macromon

A decade after the US Federal Reserve launched one of the boldest policy experiments in the modern history of central banking, economists and policymakers are still debating its implications. To prepare for future crises, five key lessons should be kept … Continue reading →

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FOMC: Hardly Tight, Hardly Loco

Posted on October 15, 2018 by macromon

The data speaks for itself. Real Effective Fed Funds Rate (REFFR) The real effective Fed Funds rate (REFFR), the Federal Reserve’s target rate of overnight commercial bank reserves lending rate less the CPI year-on-year change,  remains negative for the 36th … Continue reading →

Posted in Fed, Interest Rates, Monetary Policy, Uncategorized | Tagged , , | 8 Comments

QOTD: Slouching Toward A Banana Republic

Posted on October 10, 2018 by macromon

Could it be the markets are instead revolting against President Trump’s fiscal profligacy, and beginning to price in a potential debt crisis/major interest rate spike?   Just askin’. “I think the Fed is making a mistake. They are so tight. I … Continue reading →

Posted in Equities, Fed, Interest Rates, Monetary Policy, Uncategorized | Tagged , | 3 Comments