Tag: Quantitative Easing

Are We In Another Housing Bubble?

Home prices, and real estate activity, have picked up dramatically over the last few years, leading some to suggest that we are in another “Housing Bubble.” This week, our own bubble spotter Bill Valentine weighs in on the question of whether or not we are in a new bubble for real estate, and what that

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You Won’t Believe What Rates Are Doing!

We have talked about the end of Quantitative Easing and the possible negative effects of the Fed’s actions on interest rates and bond markets. So where are we now?  Incredibly enough….”You Won’t Believe What Rates Are Doing!”  

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We Are Making A Major Bond Shift

Let’s talk about the Taper.  Yes, the Federal Reserve is in the early stages of a resumption to normal monetary conditions.  Specifically, they have begun reducing the amount of monthly open market bond purchases, and eventually they’ll no longer be buying bonds.  Eventually, they will begin to raise interest rates. How will this affect investors’

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Good Job, Uncle Ben

Seven weeks ago, Federal Reserve Chairman Ben Bernanke hinted at the possibility of the end of Quantitative Easing (QE).  Market’s freaked out, as markets are wont to do.  We said at the time that this was an intentional intimation, and that in fact, it was a tool of the Fed Chair, as important as the

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The Market Is Like A Petulant Child

This week, the Federal Reserve continued its strategy of giving very advanced warning that its extraordinary easy policy will eventually be wound down, as we discussed in our “Market Message” on May 31, “The Worm Has Turned.”  This is fundamentally good news. It affirms the Fed’s awareness of the need to stop bond buying, and

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The Worm Has Turned

A few days ago, Federal Reserve Chairman Bernanke took what I believe to be the first step in ending Quantitative Easing (the massive money creation / bond buying program dating to the depths of the Financial Crisis).  Chairman Bernanke’s seemingly subtle mention that the Fed will stop easing if the economy continues on its current

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Is Ben Bernanke Smarter Than A Fifth Grader?

The big news this week (well, other than that phone thing) was the Fed’s announcement that they would continue purchasing mortgage-backed securities in an effort to continue stimulating the economy.  QE3 is here.  Markets liked the news, up almost 2% since the announcement. The public reaction, though, has been another story.  If you look at

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And The Winner Is? Austerity!

The economic lab experiment being played out between Austerity and Stimulus is back.  Austerity wins.  Last month, Standard & Poor’s reaffirmed the sovereign debt rating for the United Kingdom at AAA.  The UK has been pursuing a policy of “fiscal consolidation”—tightening their belt to reduce debt.  In the short run, it’s put them into a

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Spanish Undies In A Bunch?

The latest market worry is Spain.  Specifically, investors are concerned about the amount, and performance, of debt – from the sovereign, top-down level and that held on the books of its banks.  Spain’s been an economically weak outlier—in an economically weak region—for some time.  The cost of insuring their debt, as well as the yields

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Wringing of Hands: QE2, Gold, and the Dollar

QE2. What to make of it? On a stand alone basis, I don’t make that much of it. More of the same ineffective policy. Must it lead to a debasement of the dollar and hyperinflation? Nah. That’s just the current undies-in-a-bunch worry that has everyone’s attention. I agree with Alan Blinder’s recent OpEd in the

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