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Entries Tagged as 'Monetary policy'

‘QE Will Permanently Impair Living Standards For Generations To Come’ | Seeking Alpha

June 29th, 2015 · Comments Off on ‘QE Will Permanently Impair Living Standards For Generations To Come’ | Seeking Alpha

In some corners, “money printing” is like the original sin, it’s blamed for all economic problems and language tends to go into overdrive. Closer inspection reveals that behind much of the strong language there is surprisingly weak economics. A cooler assessment reveals that QE is neither a miracle cure, nor the mother of all economic […]

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Tags: Monetary policy

The Day The Central Bank Powers Came To An End

March 22nd, 2015 · Comments Off on The Day The Central Bank Powers Came To An End

Central banks in the developed world have just about thrown everything and the kitchen sink at the forces of deflation, with fairly little to show for it. After the US and the UK, the Swiss have now been the third to throw in the towel. Is this a general retreat? Are we going to succumb […]

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Tags: Monetary policy

Serving 2 Masters At A Time?

February 14th, 2015 · Comments Off on Serving 2 Masters At A Time?

Monetary policy cannot serve both economic stability and financial stability at the same time. The use of monetary policy to achieve financial stability is a blunt instrument, producing widespread collateral damage in the economy. Monetary policy should be aimed at economic stability. In order to achieve financial stability, new instruments are needed, here we discuss […]

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Tags: Monetary policy

Fooled By The Fed, Again?!

December 31st, 2014 · Comments Off on Fooled By The Fed, Again?!

After a steep fall, financial markets have once again bolted higher. According to some, this rebound was caused by some comments from Fed officials. But isn’t it curious that a mere whisper from some Fed official can turn around financial markets to the tune of trillions of dollars. Especially for those that tout the robust […]

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Tags: Monetary policy

After The Veil Of QE Is Lifted…

December 13th, 2014 · Comments Off on After The Veil Of QE Is Lifted…

There are many critics of QE, and indeed it does have limited real effects and produces some risks. However, now that the veil of QE is being lifted, what is revealed is a rather ugly world in which a host of deflationary forces conspire to take definite root. The US has, for now, managed to […]

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Tags: Monetary policy

Deflation, Rather Than Inflation Was Always The Bigger Risk

December 13th, 2014 · Comments Off on Deflation, Rather Than Inflation Was Always The Bigger Risk

In 2010, a host of people wrote an open letter to the Fed warning against the inflationary risks of unconventional monetary policy. Recently it turned out that none of these signatories repented. We’ll argue that they got their risk assessment inside-out and explain why deflation was always the much bigger risk. To The Fed’s Critics: […]

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Tags: Monetary policy

To Raise Or Not To Raise…

December 4th, 2014 · Comments Off on To Raise Or Not To Raise…

A primer on the arguments pro and contra tightening monetary policy. Those who are in favor fear asset bubbles, rising wages and want to protect income from savers. Those who are against argue that rising rates risks the recovery, inflation is low, rates would be low in the absence of Fed expansionary policies and there […]

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Tags: Monetary policy

Monetary Madness

December 1st, 2014 · Comments Off on Monetary Madness

The blitz most of the central banks in advanced nations have unleashed on the world is actually the least effective, and the most risky, way to stimulate economies. Its main transmission channel is to stuff money into banks in order to entice households to borrow more at exactly the time when they’re least likely to […]

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Tags: Monetary policy

Bill Fleckenstein Does Misunderstand Monetary Policy

December 1st, 2014 · Comments Off on Bill Fleckenstein Does Misunderstand Monetary Policy

Notable Fed critic and hedge fund manager Bill Fleckenstein sticks to his gums. But Fleckenstein’s position depends on a prediction that hasn’t yet materialized. So we think CNBC’s Futures Now host Jackie DeAngelis asked a few poignant questions, questions which Fleckenstein hasn’t really answered. Bill Fleckenstein Does Misunderstand Monetary Policy | Seeking Alpha

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Tags: Monetary policy

Are Central Banks Responsible For Asset Bubbles?

October 12th, 2014 · Comments Off on Are Central Banks Responsible For Asset Bubbles?

Many assume central banks are the main culprit for creating asset bubbles by running too loose monetary policy. However, central banks are not in control of longer-term interest rates and these have been on a downward trajectory for a couple of decades. We look at what’s behind this. The fact that central banks aren’t the […]

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Tags: Financial crisis · Monetary policy