Posts Tagged ‘Ben Bernanke’
January 5, 2023
Happy New Year! We’re starting 2023 with a podcast I recorded with Richard Bonugli and Marc Faber. We didn’t make any forecasts (in traditional CNBC fashion), but just discussed potential outcomes in the macro global financial situation.
Critical to the discussion was what I am calling the two doctrines: Paul Volcker and Ben Bernanke. The Volcker Doctrine is based on wringing inflation out of the economy when it begins to boil, while the Bernanke Doctrine is focused on preventing deflation from gaining a foothold. In the last five decades the US and Europe have not experienced DEFLATION as the central banks and fiscal authorities have PREEMPTED the onset of such an outcome. In DEBT-PLAGUED economies DEFLATION is the worst potential outcome. Remember, Volcker confronted a 39% DEBT-TO-GDP ratio while today Jerome Powell confronts a 106% ratio and even much greater private/corporate debt. Enjoy the PODCAST with a strong libation or sugar-free drink for too much stimulant will not be advised.
Click here to listen to the podcast.
Tags:Ben Bernanke, Debt, deflation, Jerome Powell, Paul Volcker
Posted in Fed | 4 Comments »
November 28, 2022
When it comes to making sense of the global financial system I always have to ask the question who is benefitting from monetary policy? The recent podcasts from the Financial Repression Authority has provided a good backdrop to understanding the importance of debt markets — and by default the significance of the US DOLLAR as the bulwark of the financial system. The mobility of money or what serves the process of globalization has revealed many of the fragilities of the DOLLAR as a funding vehicle because of the FEDERAL RESERVE’S policies, which allowed all the other world’s central banks to sustain a prolonged period of zero and even NEGATIVE NOMINAL RATES.
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Tags:Ben Bernanke, deflation, ECB, Federal Reserve, inflation, Jerome Powell, QT, quantitative tightening, Robert Holzmann, Santa Mike, US dollar, yield curves
Posted in Currency, Debt Market, Fed | 4 Comments »
August 24, 2022
I have not been a fan of yours since your January 2019 “Powell Pivot,” when you allowed yourself to be fooled by the markets. In an effort to rein in Ben Bernanke and Janet Yellen’s QE programs you went for what Stan Druckenmiller called the “double shotgun approach” and raised interest rates while reducing the Fed’s balance sheet — what Peter Boockvar called Quantitative Tightening (QT).
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Tags:Ben Bernanke, Ed Yardini, Federal Reserve, Janet Yellen, Jerome Powell, QE, QT, US dollar
Posted in Fed | 19 Comments »
August 16, 2022
On Friday I sat down with Richard Bonugli at the Financial Repression Authority and Doomberg to discuss the current situation in global energy and tried to peek into the future as to where Europe and the US are going to find the means to provide dependable and affordable energy to power economic growth. Enjoy the podcast and hopefully it will lead to more high levels of discussion on all things global macro.
Click here to view the podcast.
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Tags:balance sheet unwind, Ben Bernanke, Federal Reserve, inflation, interest rates, Janet Yellen, Jerome Powell, neutral rate, portfolio balance channel, QT, rentier class, unemployment
Posted in Fed | 13 Comments »
March 24, 2020
Well, the apocalypse has fallen upon the financial markets much as we have discussed at NOTES FROM UNDERGROUND on February 2. The onset of the DEMAND SHOCK has unleashed the fears of a deflationary spiral. My readers have been WAY AHEAD of the CNBC crowd in analyzing the potential outcomes and predicting quality trades as the PANIC IN NEEDLE PARK fostered by the central banks was/is beginning to unfold. Any person who thinks any economic release has market value raise your hand but keep it six feet away as you are likely contagious.
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Tags:Ben Bernanke, Federal Reserve, Gold, Putin, Russia
Posted in Gold | 43 Comments »
January 6, 2019
“I am a sick man. I am a wicked man.”
So opens the Dostoyevsky novella Notes from Underground. Sometimes I seem to be caught in a similar existential trap as I analyze the global macro data and fundamentals. I am sick because I continue to pursue the opportunities that explode before me. I have taken a turn for the worse and become sick because of the constant flow of manipulated headlines crafted to purposely activate the trading algorithms. Tweets and headlines with no context have become the coin of the realm, especially for high frequency trading operations. But their role in the market jungle does little to dissuade me from honing my craft. The bottom line: Greater preparation and more patience is needed.
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Tags:balance sheet unwind, Ben Bernanke, Gold, Janet Yellen, Japanese yen, Jerome Powell, nonfarm payrolls, QE, Treasury Secretary Mnuchin, U.S. Dollar
Posted in Currency, Fed, Japan, United States | 19 Comments »
February 27, 2018
In his first Congressional testimony as Fed Chairman Jerome Powell didn’t surprise as he was measured and succinct in presenting a more market-based approach to monetary policy. The equity, currency, precious metals and debt markets were all in sell mode as the prepared statement gave rise to a renewed sense that the FED will lean toward FOUR rate hikes in 2018. The key paragraph was:
“In gauging the appropriate path for monetary policy over the next few years, the FOMC will continue to strike a balance between avoiding an OVERHEATED [emphasis mine] economy and bringing PCE price inflation to 2 percent on a sustained basis. While many factors shape the economic outlook, some of the headwinds the U.S. economy faced in previous years have turned into tailwinds: In particular, fiscal policy has become more stimulative and foreign demand for U.S. exports is on a firmer trajectory. Despite the recent volatility, financial conditions remain accommodative.”
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Tags:Ben Bernanke, Fed, FOMC, inflation, IOER, Janet Yellen, Jeb Hensarling, Jerome Powell
Posted in Fed | 14 Comments »
September 27, 2017
In several blog posts over the last eight years I have used the words of Mao to relate to the potential issues that could cause severe disruption to the global financial system. If you listen to the narrative propagated by the mainstream financial media your concerns would revolve around North Korea, the Trump tax and healthcare plans, the FED starting QT (or else citing the Fed’s ridiculous dot plots), concerns about the potential shutdown of the U.S. government, the economic implications of Brexit, etc. The bottom line is that all the forecasters have been wrong for long as Phillip Tetlock revealed in his wonderful book, Superforecasting. The FED has been worshiped as all-knowing fonts of wisdom when nothing they have forecast has proven correct. Yesterday, Fed Chair Janet Yellen admitted that the FED is as confused about the lack of inflation as most of the prognosticators on Wall Street. This confirmed my theory that what the FED peddles IS NOT ROCKET SCIENCE.
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Tags:Angela Merkel, Ben Bernanke, Christian Lindner, Fed, FOMC, Gerhard Schroeder, Janet Yellen, Lael Brainard, Macron, QT, Rosneft, S&P/bond ratio, Wolfgang Schaeuble
Posted in Fed, Germany | 14 Comments »
June 26, 2017
Set your way back machines to and visit the philosophy of the Young Marx in his famous musings, The Economic and Philosophic Manuscripts of 1844. Read the concerns that Marx raises about the ALIENATION of LABOR. In the book edited by Dirk J.Struik, I am citing pieces from the chapter, “Wages of Labor.”
- “Wages are determined through the antagonistic struggle between capitalist and worker.”
- “The demand for men necessarily governs the production of men,as of every other commodity. Should supply greatly exceed demand, a section of the workers sinks into beggary or starvation.”
- “The worker need not necessarily gain when the capitalist does,but he necessarily loses when the latter loses.”
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Tags:Ben Bernanke, Fed, FOMC, Gold, Janet Yelle, Marx, NAIRU, Phillips Curve, U.S. Dollar, wages
Posted in Fed | 12 Comments »
September 6, 2016
On the Santelli Exchange, me and Rick discussed the very weak ISM non-manufacturing and its impact on the FOMC. The surprise weakness sent PRECIOUS METALS soaring, the DOLLAR lower, BONDS AND EUROPEAN SOVEREIGNS HIGHER and EQUITY MARKETS moderately higher. The FED is under the microscope from so many analysts but the surprise of the day was the OP-ED piece by Professor Larry Summers in the Washington Post. Summers put an academic gloss on the erudite review of Jackson Hole but this sentiment is key: “My second reason for disappointment in Jackson Hole was that Fed Chair Janet Yellen, while very thoughtful and analytic, was too complacent to conclude that even if average interest rates remain lower than in the past, I believe that monetary policy will, under most conditions, be able to respond effectively. THIS STATEMENT MAY RANK WITH FORMER FED CHAIRMAN BEN BERNANKE’S UNFORTUNATE OBSERVATION THAT SUBPRIME PROBLEMS WOULD BE EASILY CONTAINED,” [emphasis mine]. This is a harsh assessment from a fellow academic, but more importantly it is a stinging criticism of the FED’s forecasting history.
(Click on the image to watch me and Rick discuss weak U.S. data, the Fed and G-20)
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Tags:Ben Bernanke, BOC, ECB, Fed, FOMC, Janet Yellen, Larry Summers, Mario Draghi, QE
Posted in Central Banks, Fed | 4 Comments »