Posts Tagged ‘Mark Carney’
January 14, 2016
Jim Bullard? Now There Is An Unsavory Chap
Today was not like the other days for the break in the equity markets came early. As all the global markets were in sell mode St. Louis Fed President James Bullard hit the airwaves with thoughts about being wrong in his inflation projections. It appears that the selloff in crude oil is providing the Fed hawk with concerns that the SUMMARY of ECONOMIC PROJECTIONS may be softer than the December FOMC meeting revealed. Bullard sounded as if he would not be in favor of the Fed raising rates because of the inflation rate turning away from the spurious 2 percent mandate. The unsavoriness of Bullard’s comment is not that he fears a downturn in inflation, and maybe lower growth, but that Bullard seemed to find his DOVISH posture as the U.S. markets were heading toward the August lows. Bullard in unsavory because he called out CNBC’s Jim Cramer for “cheerleading for low rates twenty-four hours a day.”
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Tags:BOE, DAX, Dow, Fed, inflation, James Bullard, Mark Carney, NASDAQ, Nikkei, Saudi Arabia, SPS, U.S. 2/10 curve
Posted in Equity, Fed, Uncategorized | 15 Comments »
November 5, 2015
Is it the first Friday of a new month already? If so, then it must be time for the release of the U.S. employment data and preparing for a day of market volatility driven by the machines of madness and their algorithmic masters. In preparation for the trading madness, it seems that the consensus is for a nonfarm payrolls increase of 192,000 jobs, a work week of 34.5 hours, and, most important for Chairman Yellen, an increase in average hourly earnings of 0.2%. It appears that a strong number will result in a higher probability of the FED raising rates at the December 15-16 FOMC meeting. It is the problem of dissecting what a STRONG EMPLOYMENT is that makes trading and investing so difficult for the next six weeks. Is it the number of jobs created and the impact on the unemployment rate that renders the most powerful argument for the Fed hawks? Or is it the level of wages relative to GDP and corporate profits that is the most significant indicator of job strength and possible inflation?
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Tags:British pound, EUR/GBP, Fed, FOMC, Janet Yellen, Mario Draghi, Mark Carney, nonfarm payrolls, Stanley Fischer, U.S. Dollar
Posted in BOE, Currency, data, Fed, United States | 13 Comments »
February 2, 2015
The fact that today is GROUNDHOG DAY means that we have to keep discussing Greece again and again. The alarms sound over the demands of Syriza’s and its leader Alexis Tsipras and his efforts to craft a NEW DEAL for Greece in relation to its creditors. Any debt or interest rate relief Mr. Tsipras can attain from the TROIKA would allow his ruling party to declare victory and also provide a template for renegotiation of all previous austerity measures to which European debt plagued nations agreed. (I am not making a qualitative judgment about the Greek restructuring but just raising the issue of the great uncertainty it will cause in currency and bond markets.)
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Tags:Angela Merkel, Aussie/Kiwi cross, EU, Euro, Europe, Germany, Greece, Mario Draghi, Mark Carney, RBA, Thomas Mayer
Posted in ECB, Europe, Germany, Greece | 10 Comments »
November 17, 2014
The Bank of England’s chief-economist had the line of the month in his response to the disinflationary forces confronting Europe and the U.K. It seems that the G-20 did yield much more discussion about Europe’s economic malaise than was revealed in the communique. BOE Governor Mark Carney was warning of stagnant Europe being a drag on the global economy and impacting British growth. Even the economically challenged British Prime Minister David Cameron warned of flashing “red lights” on his economic dashboard. The last inflation data from the BOE revealed that inflation has fallen below its target and the lack of growth in its largest trading partner, the EU, threaten to push inflation lower than previously expected.
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Tags:Abe, Andrew Haldane, BOE, BOJ, disinflation, Dollar, EU, FOMC, G-20, GDP, Japan, Mark Carney, U.K., Yen
Posted in BOE, BoJ, Currency | 4 Comments »
September 9, 2014
Did he really say that about currencies and sovereignty? In an article in tomorrow’s Financial Times it is reported that Mark Carney said during a Q&A that a “… currency union between England and an independent Scotland would be ‘ incompatible with sovereignty.'” Carney said a currency union needed three elements for success. “These were the free movement of goods and services across different parts of the currency, a banking union underpinned by common institutions such as a central bank, and elements of shared fiscal arrangements.” Fanning the flames of criticism against the euro and Brussels, Carney added: “You only have to look across the continent to look at what happens if you don’t have those components in place. A currency union is incompatible with sovereignty.”
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Tags:ABS, BOE, Bundesbank, ECB, Jens Weidmann, Mario Draghi, Mark Carney, Scotland
Posted in BOE, ECB, Europe, UK | 3 Comments »
September 3, 2014
The wires are burning with the possibility of the ECB moving forward with a quantitative easing announcement. I would give it a 1% chance, or, in options pricing terms, A CABINET BID. It is too early for President Draghi to impose a QE plan for next month the European authority reveals its asset quality review (AQR), a stress test by any other name. The ECB would be wasting its ammunition until it sees how the market reacts to new information on the health of European banks and thus the European financial system. If the results are as dismal as I believe, Draghi will want to initiate his asset-backed security program so as to create a market mechanism for relieving the banks of their problem loans. The market maker for these ABS instruments will be the ECB as they will be the only buyers willing to pay inflated prices for NONperforming loans. High prices will need to be paid to keep the banks solvent for if the haircuts on the troubled loans is too large the banks will collapse.
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Tags:BOE, British pound, ECB, EU, euribor futures, Euro, Europe, Mario Draghi, Mark Carney, QE, Ukraine
Posted in BOE, Currency, ECB, Europe | 10 Comments »
July 9, 2014
Tomorrow the Bank of England’s Monetary Policy Committee meets to decide interest rates. Governor Mark Carney has recently confused markets by saying that interest rates would probably rise sooner than forecast. Then Mr. Carney changed directions by following the FOMC and suggesting that the slack in the labor market would allow the BOE to stay the present course and keep interest rates at present levels for an extended period. Overnight rates are currently at 0.50% and with the British pound strengthening against most currencies the BOE is expected to maintain the status quo.
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Tags:Basel III, BIS, BOE, British pound, David Cameron, Fed, FOMC, Janet Yellen, Mark Carney, regulatory tools
Posted in BOE, Fed, Regulation | 1 Comment »
June 24, 2014
It was 12 days ago the BOE’s Mark Carney delivered his Mansion Speech and warned markets that interest rates could rise faster than investors were forecasting, resulting in a strong rally in the British Pound against all currencies. The POUND was especially strong against its largest trading partner the European Union. Today, Governor Carney synchronized his thoughts with Fed Chair Yellen and announced that the BOE may be able to keep rates low for longer because the lack of rise in wages meant that there was still GREAT SLACK IN THE ECONOMY. (It appears that the central bankers have been cheating off each others’ papers.)
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Tags:BOE, ECB, Mark Carney, Merkel, Pound, short sterling, volatility
Posted in ECB | 11 Comments »
June 16, 2014
The FED meeting begins tomorrow and concludes Wednesday with a full-blown Janet Yellen press conference. The FOMC is expected to continue the path of TAPERING by removing another $10 BILLION of asset purchases but still continuing to add to its massive balance sheet. There is talk among the “pundits” about Chair Yellen raising the expectations of a FED move to increase interest rates sooner than the market predicts. Concern has grown because several FOMC members have raised the issue of higher REVERSE REPO and IOER (INTEREST ON EXCESS RESERVES) RATES in an effort to drain some of the vast amounts of liquidity sloshing around in the banking system.
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Tags:BOE, eurodollar futures, Fed, FOMC, forward guidance, IOER, Janet Yellen, Mark Carney, QE, reverse repo, Stanley Fischer, tapering, U.K. 2/10 curve
Posted in BOE, Debt Market, Fed | 7 Comments »
