Analysis Topic: Interest Rates and the Bond Market
The analysis published under this topic are as follows.
Wednesday, August 01, 2018
Trump Declares War on the Fed / Interest-Rates / US Federal Reserve Bank
By: Michael_Pento
It appears when it comes to fighting the old Washington establishment---comprised of the deep state and the Federal Reserve--Mr. Trump is getting sucked into the vortex of the D.C. swamp rather than draining it. The hope was for our “Disrupter in Chief” to be more concerned about our children’s future than his own; and for his focus to span beyond the next election cycle. Instead of allowing consumers to finally receive a real return on their savings; and to let asset bubbles seek a level that can be supported by the free market, Trump has chosen to breach a boundary that has been essential to providing hope for the future solvency of our nation.
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Thursday, July 19, 2018
The Fonzie–Ponzi Theory of Government Debt: An Update / Interest-Rates / Global Debt Crisis 2018
By: F_F_Wiley
This post is excerpted from my book Economics for Independent Thinkers, although with some updating. It seems relevant after the CBO’s latest long-term budget outlook, which in its optimistic “baseline scenario” called for America’s net federal debt to double over the next 30 years, rising from 76% of GDP in 2017 to 152% in 2048.
Before reaching this chapter or even picking up this book, I imagine many of you were already loosely divided into the two major camps of the public debt debate. The first camp is already concerned and doesn’t need my research to form an opinion. These people stress the math involved in borrowing—the idea that you get do extra stuff today, but you have to somehow pay for it in the future. Meanwhile, those in the other camp ask, “So what?” They might argue that America will make good on its debt because “it always does.” Or they’ll point confidently to America’s unique advantages as a military superpower, paragon of political stability, and steward of the world’s predominant reserve currency. Confronted with the lessons of history, they’ll say, “This time is different.”
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Saturday, July 14, 2018
Uncle Sam’s Debt-Money System Is Immoral, Tantamount to Theft / Interest-Rates / US Debt
By: MoneyMetals
Mike Gleason: It is my privilege now to welcome in Keith Weiner, CEO and Founder of Monetary Metals, and President of the Gold Standard Institute USA. Keith is a hard money advocate who has been an outspoken proponent for the gold standard and restoring sound money to our nation's monetary system. Keith has a PhD from the New Austrian School of Economics, and his articles have appeared in numerous publications on Internet sites throughout the globe, and it's a real pleasure to have him on with us today.
Keith, thanks so much for taking the time, and welcome.
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Friday, July 13, 2018
How International Observers Undervalue the Chinese Bond Market / Interest-Rates / China
By: Dan_Steinbock
Criticism is typical of vibrant international media. Yet, prejudiced biases in financial matters have the potential to harm investors worldwide. The Chinese bond market is a case in point. Not only is China’s bond market growing explosively, but it has become diversified and provides broad investment options to both Chinese and foreign investors.
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Tuesday, July 03, 2018
Is this the Most Hawkish Fed Ever? / Interest-Rates / US Interest Rates
By: Michael_Pento
My research shows that this is one of the most hawkish Fed rate-hiking regimes ever. It has raised rates seven times during this current cycle and is on pace to raise the Fed Funds Rate(FFR) four times this year and three times in 2019.But what makes its monetary policy extraordinarily restrictive is that for the first time in history the Fed is also selling $40 billion per month of Mortgage Backed Securities (MBS) and Treasuries starting in Q3 and $600 billion per year come October. Because the Fed is destroying money at a record pace while the rest of the world’s major central banks are still engaged in money printing (QE) and zero interest rate policies (ZIRP), Jerome Powell’s trenchant and unilateral tightening policy is now causing chaos in emerging markets.
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Saturday, June 30, 2018
Things To Know About This Week’s CBO US Debt Report / Interest-Rates / US Debt
By: F_F_Wiley
Here are six things you might like to know about the Congressional Budget Office’s 2018 Long-Term Budget Outlook, which was released on Tuesday.
- The CBO’s baseline scenario shows federal debt held by the public rocketing upward at a trajectory not seen since 2009, but this time on a sustained basis and breaching 150% of GDP by 2048. Here’s the chart:
Tuesday, June 26, 2018
The Federal Reserve And Long-Term Debt – Warning! / Interest-Rates / US Debt
By: Kelsey_Williams
Won’t somebody please say something different about the Federal Reserve? Or nothing at all?
It seems amazing to me that we are so studiously focused on comments, statements, or actions emanating from the Fed. It is as if we expect to find a morsel of truth that will give us special insight or a clue as to their next move.
I suppose that is reasonable to a certain extent – especially today. We are social-app (il)literate and very impatient. Seems to be a sort of day-trader mentality. Problem is that every morning we see the same headlines. All week long we hear about the most recent Fed meeting, or the release of minutes from the last meeting, or what to expect at the next meeting, etc., etc. And the cycle repeats itself every month. (I’m not Bill Murray and this is not Ground Hog Day.)
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Tuesday, June 26, 2018
The Fed Just Made Its Most Hawkish Turn in 30+ Years (Did Anyone Notice?) / Interest-Rates / US Interest Rates
By: F_F_Wiley
I realize it’s getting late to discuss the June 12–13 FOMC meeting, but I think the Fed’s biggest news from that meeting may have slipped under the radar. To confirm the relevance of what I thought I heard during the post-meeting press conference, I spent some time last week reviewing old speeches, transcripts and other materials produced by Fed officials. I’m now convinced that Chairman Jerome Powell delivered an important message that went largely unreported, and I expect him to keep at it until people take notice.
Powell’s message is that he intends to pop bubbles—both asset-price and credit bubbles. He didn’t communicate a precise threshold for bubble popping, but I believe he meant not just big bubbles but potentially little bubbles and possibly even pre-bubbles if that becomes necessary to contain the risks of financial instability. If we take him at his word, we should expect him to respond much more aggressively than his predecessors did to financial excesses, and those aggressive responses will occur even without an inflation threat. In other words, policy adjustments designed to maintain financial stability could disconnect from the FOMC’s inflation target.
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Monday, June 25, 2018
Powell is Playing “Chicken” With $10 Trillion in $USD Shorts / Interest-Rates / US Federal Reserve Bank
By: Graham_Summers
Thus far in his tenure as Fed Chair, Jerome Powell has emphasized that he is more concerned with the real economy than the financial markets.
Put another way, the Powell Fed, unlike the Bernanke or Yellen Feds before it, is willing to sacrifice stocks in the name of normalizing monetary policy provided the economy can withstand it.
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Thursday, June 07, 2018
Judgment Day for the ECB / Interest-Rates / ECB Interest Rates
By: Arkadiusz_Sieron
Will the ECB Withstand Pressure?
Next week, the ECB will hold its monetary policy meeting. The bank was expected to start winding down its stimulus program at the end of 2018. However, Italian turmoil led some analysts to think that the ECB will remain cautious. Will the ECB withstand the pressure or funk? And what does it all mean for the gold market?
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Tuesday, June 05, 2018
What the Bond Markets Are Finally Saying About Italy / Interest-Rates / Italy
By: Harry_Dent
Over the years I’ve spent much time talking about Italy as the next ticking time bomb for Europe and the global banking system.It’s government debt is the third highest in the world at 132% of GDP, coming only after Japan and Greece.
Its private debt is 23% of the Eurozone versus Greece’s 3%.
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Friday, May 25, 2018
The Bond Market Just Figured Out That Central Banks CANNOT Exit / Interest-Rates / US Bonds
By: Graham_Summers
To recap yesterday’s piece concerning the recent shift in Central Bank policy, from mid-2016 onward:
1) Central Banks engaging in emergency levels of QE at a time in which their respective economies were growing.
2) Inflation bottoming then beginning to rise.
3) Bond markets starting to revolt.
4) Central Banks opting to walk back their QE programs.
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Monday, May 21, 2018
Inverted Yield Curve: It’s Definitely Not Different This Time / Interest-Rates / US Interest Rates
By: Michael_Pento
An inverted yield curve occurs when the yield on shorter-dated securities is above that on longer-term bonds; and it has predicted all nine U.S. recessions since 1955, according to Bloomberg. Of course, now that the yield curve is the flattest since 2007—with the 2-10 spread falling to just 45 basis points, from 260bps in 2014--right on cue the carnival barkers on Wall Street have been deployed in full force claiming this key financial barometer is now broken.
Friday, May 18, 2018
Flattening Yield Curve is Good / Interest-Rates / US Interest Rates
By: Axel_Merk
In recent months, pundits have cautioned about a flattening yield curve, suggesting it may signal the end of the economic expansion, the end of the bull market, possibly even the end of the world as we know it. There's plenty to worry about in the markets, but in the spirit that knowledge is the enemy of ignorance, let's clear up some myths.
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Monday, April 30, 2018
US Bond Market 10-Year Yield: From A 35-Year Bear To A Generational Bull Market / Interest-Rates / US Bonds
By: Mike_Paulenoff
In early March, 10-year yield was circling 2.87%. Now it is circling 3.00% for the first time in 4 years. The increase is probably shocking to many analysts and investors. Neither economic nor inflation data provide adequate justification for yield to be higher than it was two months ago. But there are times when the contradicting longer-term technical set-up should be heeded, even when the trend lacks strong support from lagging tabular data.
Monday, April 30, 2018
A Contrarian Take on the Great Yield Curve Scare / Interest-Rates / US Interest Rates
By: F_F_Wiley
Media coverage of most business-cycle indicators waxes and wanes with changes in the economy, but so far in 2018, the yield curve indicator is all wax. It seems like everyone has something to say about the yield curve slope, and many commentators are jumping from a flatter curve to a growing risk of recession.
Even central bankers have joined in, with a recent article from the San Francisco Fed declaring that “the term spread is by far the most reliable predictor of recessions.”
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Monday, April 23, 2018
Fox in the Henhouse: Why Interest Rates Are Rising / Interest-Rates / US Interest Rates
By: Ellen_Brown
The Federal Reserve calls itself independent, but it is independent only of government. It marches to the drums of the banks that are its private owners. To prevent another Great Recession or Great Depression, Congress needs to amend the Federal Reserve Act, nationalize the Fed and turn it into a public utility, one that is responsive to the needs of the public and the economy.
On March 31 the Federal Reserve raised its benchmark interest rate for the sixth time in three years and signaled its intention to raise rates twice more in 2018, aiming for a Fed funds target of 3.5 percent by 2020. LIBOR (the London Interbank Offered Rate) has risen even faster than the Fed funds rate, up to 2.3 percent from just 0.3 percent 2 1/2 years ago. LIBOR is set in London by private agreement of the biggest banks, and the interest on $3.5 trillion globally is linked to it, including $1.2 trillion in consumer mortgages.
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Tuesday, April 17, 2018
Why the Fed is Worse for the Market than Trade Tariffs / Interest-Rates / US Federal Reserve Bank
By: Rodney_Johnson
“Always tell the truth.”In addition to being number eight on the Top 10 list of things we should always do, being truthful is just a great way to avoid trouble in life.
You never have to remember what lie you told to whom, and you never have to make up more lies to cover those you’ve already put out into the universe.
But we don’t.
I don’t know a single person who is completely honest. And this goes way beyond, “Do these clothes make me look fat?”
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Monday, April 16, 2018
THE Financial Crisis Acronym of 2008 is Sounding Another Alarm / Interest-Rates / Financial Crisis 2018
By: Michael_Pento
LIBOR, or the London Interbank Offered Rate, was the most important acronym most investors never heard of before 2008. However, it quickly became the most critical variable in markets leading up to the Great Recession.
What has now become clear is that we haven’t learned any lessons from the financial crisis except how to accumulate more debt and to artificially control markets more extensively. And, to conveniently try to sweep under the rug the very same warning signs that forebode the day of reckoning just over a decade ago.
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Monday, April 09, 2018
Average Two-year Fixed Mortgage Interest Rate at 19 Month High / Interest-Rates / Mortgages
By: MoneyFacts
Moneyfacts UK Mortgage Trends Treasury Report data (not yet published) reveals that the average two-year fixed rate mortgage has increased for the second month in a row, to reach the highest point seen since September 2016.
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