After FEDERAL RESERVE Chairman Jerome Powell’s Jackson Hole speech, the jobs data may have taken on added significance. Inflation was not a concern for Powell as that is considered transitory within the bowels of the FOMC. The failure of the employment situation to enable all who lost jobs due to COVID “through no fault of their own” has regained paramount importance.
Posts Tagged ‘Bill Gross’
Notes From Underground: Will It Be An Inflated Jobs Report?
September 2, 2021Notes From Underground: The World Is Digesting Trump and About Europe Grow
January 22, 2017The inauguration is over. Davos is behind us. Let’s start examining the impact of policy and politics as we move forward. The first three weeks has brought stasis for equity markets as the S&Ps have not set new highs since the December exuberance. Investors are beginning to comprehend that the slow-moving legislative process will impede Trump’s efforts for an expedited deregulation and tax reform program. But, if you follow the proliferation of stories about a possible dissolution of the EU, my prediction with Rick Santelli about Europe being the main focus of 2017 is coming to fruition. One wonders what was discussed in the backrooms of Davos that led so many global executives to suddenly express concerns about the increased populism in the Netherlands, France and even Germany. It seems that the Dutch elections have gained a prominent position as a severe test for Brussels-based eurocrats.
Notes From Underground: If Gross, Gundlach and Even Buffet Are Correct, Then THE FED IS WRONG
May 5, 2015The last seven weeks has brought out the bond bears in the forms of Bill Gross, Jeff Gundlach and also well-known stock picker and financial wizard, Warren Buffett. While Gundlach and Gross were very bearish on the European sovereign debt markets, the Omaha denizen opined on how stocks may be rich but bonds offer a terrible risk/reward return. Large bond investors are nervous that they have possibly bought an overvalued asset and may experience sizable losses on a quarter-to-quarter to basis. The problem for pensions, insurance companies and those saddled with a defined payout obligation, the FED and other central banks have broken the bond market as a value barometer so it is very difficult to match assets with potential liabilities.
Notes From Underground: Volcker Finds His Voice
June 4, 2013Ex-FED Chairman Paul Volcker delivered a speech on May 29, which served as a “shofar” blast, warning the FED and its governors to be cautious in possibly undermining the credibility that all central bankers strive to maintain. Mr. Volcker does not doubt the intelligence of Chairman Bernanke but what he worries about “… is a matter of good judgment, leadership and institutional backbone” (READ THAT AGAIN). “A willingness to act with conviction in the face of predictable political opposition and substantive debate is, as always a requisite part of a central bank’s DNA.” Now, knee-jerk FED supporters (insert name here) will maintain that is what Bernanke did in presenting QE1, QE2 and QE3–but he certainly had the support of a democrat-controlled HOUSE and SENATE in 2010. Also, the White House was a fervent supporter of massive monetary stimulus as he helped keep the economy from sliding into a chaotic state of asset liquidation. The FED may have suffered the barbs of some “tea party” legislators but for the most part the major powers in Washington and Wall Street provided the needed support for the FED.
Notes From Underground: Bill Gross Goes Biblical … Sort Of
April 5, 2012In a comment directed toward the European peripherals, Pimco’s Bill Gross said that Greece was a zit, Portugal a boil, and Spain a tumor. Readers of NOTES FROM UNDERGROUND know that Spain has been on the radar for a long time. The growth numbers or lack of growth, rather, hampered by severe austerity budgets have generated ADVERSE FEEDBACK LOOPS that have rendered all economic projections null and void. When austerity bites, all growth forecasts are cast asunder. Staying with Gross’s almost biblical references, I suggest looking at Europe though the lens of the TEN PLAGUES.
Notes From Underground: The Markets to Bernanke–CAN YOU HEAR ME NOW?
January 29, 2012Post-FOMC meeting it seems the FED move is fraught with all types of dangers as the even all the bitterness and acrimony flowing out of the loose lips of EUROCRATS could not prevent a slide in the U.S. DOLLAR. FED AGGRESSIVENESS AND ITS FINANCIAL REPRESSION TRUMPS THE LUNACY THAT IS EUROPE. It is apparent that the FED‘s policy is to push U.S. rates lower across the entire curve–WE KNEW THAT–and to get ahead of any political criticism that is surely to arise as Chairman Bernanke appears before the House Budget Committee on Thursday. Paul Ryan will certainly give Mr. Bernanke a difficult time as the republicans will want to make the FED and its policies part of the election debate.
Notes From Underground: DSK Spoke in Beijing and Now His Black Book Has Replaced Mao’s Redbook
December 19, 2011Dominique Strauss-Kahn delivered a speech today in Beijing, lambasting the leadership of Europe for its “state of denial” about the severity of the credit crisis. It seems that an angry DSK is speaking his mind now that he has no official capacity and can lash out at European leaders. The former IMF managing director was well received by his Chinese hosts who showed their appreciation for all the work DSK did to elevate the status of the Chinese in the IMF.
Notes From Underground: Sarkozy Has Overplayed a Bad Hand and It Has Cost Europe
November 16, 2011It has been the best of times. It has been the worst of times. President Sarkozy began the year with such high hopes and aspirations as he desired to raise his stature on the world stage. He won his early skirmishes against Chancellor Angela Merkel by first defeating Germany’s desire for Axel Weber to attain the ECB Presidency and then forcing the German Chancellor’s hand for a larger pool of capital for the European Financial Stability Facility. But the taste of victory has now faded as the FRENCH BOND MARKET is suffering under the weight of its deeply troubled banks and the GERMAN/FRENCH 10-YEAR BOND SPREAD CONTINUES TO WIDEN. France is deemed to be very vulnerable for its banks own so much EURO SOVEREIGN DEBT that of course is deemed to be riskless and require no haircut or capital to support it.
Notes From Underground: Awaiting the FOMC
September 20, 2011The media has made the idea of a TWIST by the FED a sure thing. Okay, can’t argue with consensus, but of course that is why this blog exists: To question the thought process of the purveyors of conventional wisdom and to try to profit in a real-time world from challenging the status quo. If the FED TWISTS will the markets turn? BUT TURN TO WHAT? What will a lowering of the rate on the 10-year note do to a stalling economy with zero interest rates? Bernanke himself alluded to the BALANCE SHEET REPAIR taking place in the private sector, which was holding back consumer demand. Even though corporate balance sheets are healthy, capital investment lags as the corporations fear lackluster demand so there is no rush to create new supply.