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 Post subject: Re: ECB Watch
PostPosted: Tue Feb 14, 2017 11:25 am 
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Fairly sizeable jump from 1.1% in December to 1.8% in Jan in the Eurozone. But so called core inflation still at 0.9%.

So at what point do ECB raise rates? Overall inflation over 2% for say three consecutive months or core inflation near 2%?


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 Post subject: Re: ECB Watch
PostPosted: Wed Mar 01, 2017 2:49 pm 
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 Post subject: Re: ECB Watch
PostPosted: Wed Mar 01, 2017 2:53 pm 
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@fwred a good follow. Frederik Ducrozet - Market Economist, ECB Watcher

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 Post subject: Re: ECB Watch
PostPosted: Tue Nov 27, 2018 9:08 pm 
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It's a year and a half since anyone posted on the Central Bank forum, apart from the National Debt thread (i.e. about fiscal policy) and the "Giz a Job..." thread.

I'm sure Pinsters know that monetary policy is what makes the property world go round so we should keep our eye on the ball. Trump is trying to bully the Fed but it looks like they will ignore him and keep going i.e. from zero to 3.4% by 2021.

Martin Feldstein is writing in support of Fed policy in the WSJ today so you know they are serious. Feldstein was Reagan's economic advisor and Wall Street listens to him even when he wants to take away the punch bowl. He argues that we already have an asset-price bubble because the Fed delayed lifting rates years so its probably to late to avoid a deep recession. Of course, if the Fed chickens out now, the consequences would be even more catastrophic.

Quote:
Looking ahead, there is a significant risk that the U.S. economy will slide into recession in the next few years. Though gross domestic product has grown robustly of late, bloated asset prices will likely collapse, dragging industry down with them. The price-earnings ratio of the S&P 500 is nearly 40% above its historic average. As long-term interest rates return to normal levels, demand for equities and other assets will decline rapidly. A return of share prices today to their historic price-earnings ratios would wipe out nearly $8 trillion of household wealth. The resulting decline in consumer spending and the related fall in business activity would be enough to push the economy into recession.

If that scenario plays out in the next few years, the Fed won't be able to achieve a large rate reduction. Even if the Fed raises the fed-funds rate to 3.4% by the end of 2021, as it currently plans to do, that will not be high enough to allow a substantial rate reduction. And the consequence would be a deeper and longer recession than usual.


Not to worry, of course. We learned our lesson ten years ago, now the Irish economy is completely insulated from Wall Street. XX

https://www.wsj.com/articles/raise-rate ... 1543276851


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 Post subject: Re: ECB Watch
PostPosted: Wed Nov 28, 2018 2:17 pm 
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Lefournier3 wrote:
It's a year and a half since anyone posted on the Central Bank forum, apart from the National Debt thread (i.e. about fiscal policy) and the "Giz a Job..." thread.

I'm sure Pinsters know that monetary policy is what makes the property world go round so we should keep our eye on the ball. Trump is trying to bully the Fed but it looks like they will ignore him and keep going i.e. from zero to 3.4% by 2021.

Martin Feldstein is writing in support of Fed policy in the WSJ today so you know they are serious. Feldstein was Reagan's economic advisor and Wall Street listens to him even when he wants to take away the punch bowl. He argues that we already have an asset-price bubble because the Fed delayed lifting rates years so its probably to late to avoid a deep recession. Of course, if the Fed chickens out now, the consequences would be even more catastrophic.

Quote:
Looking ahead, there is a significant risk that the U.S. economy will slide into recession in the next few years. Though gross domestic product has grown robustly of late, bloated asset prices will likely collapse, dragging industry down with them. The price-earnings ratio of the S&P 500 is nearly 40% above its historic average. As long-term interest rates return to normal levels, demand for equities and other assets will decline rapidly. A return of share prices today to their historic price-earnings ratios would wipe out nearly $8 trillion of household wealth. The resulting decline in consumer spending and the related fall in business activity would be enough to push the economy into recession.

If that scenario plays out in the next few years, the Fed won't be able to achieve a large rate reduction. Even if the Fed raises the fed-funds rate to 3.4% by the end of 2021, as it currently plans to do, that will not be high enough to allow a substantial rate reduction. And the consequence would be a deeper and longer recession than usual.


Not to worry, of course. We learned our lesson ten years ago, now the Irish economy is completely insulated from Wall Street. XX

https://www.wsj.com/articles/raise-rate ... 1543276851



US inflation is barely above 2 % and trumps tariffs is likely to moderate any further growth rates
Feldstein is an inflation hawk wanting rising rates in the throws of a recession/depression.
Some who gives better insight into the Fed policy and direction is Tim Duy


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 Post subject: Re: ECB Watch
PostPosted: Wed Nov 28, 2018 3:01 pm 
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Has anyone looked at the amount of house Foreclosours in the USA. Europe looks wealthy in comparison to housing stock. America has all timber frame and asphalt singles (tar) on their roofs, and we all know what happened as forestry management in California when all the houses went up in flames. No asset value there compared with European concrete.


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 Post subject: Re: ECB Watch
PostPosted: Wed Nov 28, 2018 11:45 pm 
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propertyspire wrote:
US inflation is barely above 2 % and trumps tariffs is likely to moderate any further growth rates
Feldstein is an inflation hawk wanting rising rates in the throws of a recession/depression.
Some who gives better insight into the Fed policy and direction is Tim Duy


US inflation is on target and Trump's tax cuts have boosted an economy already running close to capacity. Feldstein is not looking to raise rates in a recession. On the contrary, he wants to raise rates now so the Fed has scope for rate cuts during the next recession.

I see Tim Duy on Bloomberg occasionally. All due respect, not in Martin Feldstein's league. His views won't influence the Fed.


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 Post subject: Re: ECB Watch
PostPosted: Thu Nov 29, 2018 3:41 pm 
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Lefournier3 wrote:
propertyspire wrote:
US inflation is barely above 2 % and trumps tariffs is likely to moderate any further growth rates
Feldstein is an inflation hawk wanting rising rates in the throws of a recession/depression.
Some who gives better insight into the Fed policy and direction is Tim Duy


US inflation is on target and Trump's tax cuts have boosted an economy already running close to capacity. Feldstein is not looking to raise rates in a recession. On the contrary, he wants to raise rates now so the Fed has scope for rate cuts during the next recession.

I see Tim Duy on Bloomberg occasionally. All due respect, not in Martin Feldstein's league. His views won't influence the Fed.


Fledstein wanted the Fed to raise rates in 2011/2012 which would have been a stupid time to raise rates in a week economy, they clearly didn't listen to him then. Fledstein being an inflation hawk is always keen to raise rates. I dont think anyone is listening to him now either, however the Fed is well disposed to increasing rates.

Rate raises are decided by a committee of the Governors of regional Fed offices, based on the data and some steering by Powell. Some vote for rate raising and some dont. The data and the views of the Governors (, at present, suggest further rises will occur in 2019. Maybe if you want to view the likely trajectory of rates, you can do a lot better than Feldstein.


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 Post subject: Re: ECB Watch
PostPosted: Thu Nov 29, 2018 11:37 pm 
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propertyspire wrote:
Fledstein wanted the Fed to raise rates in 2011/2012 which would have been a stupid time to raise rates in a week economy, they clearly didn't listen to him then. Fledstein being an inflation hawk is always keen to raise rates. I dont think anyone is listening to him now either, however the Fed is well disposed to increasing rates.

Rate raises are decided by a committee of the Governors of regional Fed offices, based on the data and some steering by Powell. Some vote for rate raising and some dont. The data and the views of the Governors (, at present, suggest further rises will occur in 2019. Maybe if you want to view the likely trajectory of rates, you can do a lot better than Feldstein.


He was not happy with QE in 2012 but I don't recall him asking for interest rate increases then. He is an inflation hawk if you mean he wants to pre-empt future inflation.

The discount rate is set by the Fed's Board of Governors, not the Governors of the regional Federal Reserve Banks (some of them serve on the FOMC)

They listen to Feldstein, among other heavyweight economists, but Powell's comment yesterday created an impression in the markets that the Fed is close to finishing its interest rate rises. The reaction of the markets to his ambiguous comments shows how much the markets now depend on loose money.

https://www.cnbc.com/2018/11/28/markets ... ments.html


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 Post subject: Re: ECB Watch
PostPosted: Sat Dec 08, 2018 10:35 pm 
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