Latest Fed Speak
Some cogent and some not so cogent fed speak...
Remember our comment yesterday, regarding the debt as a % of GDP.... today, Benny & The Fed's reiterated: the U.S. faces a budget crisis unless Congress acts to the cut the federal deficit. ...
and... Bernanke said that the Fed along with the president's working group, aka PPT (Plunge Protection Team) which was formed in the wake of the 1987 stock market crash, had been closely monitoring market developments.
...if current corrections under way in housing and the amount of inventories being held by business stabilize in coming months, the economy should begin to rebound from its current slowdown by the end of the year... good luck on that one...
re: subprime lending "It's a concern, but at this point we don't see it as being a broad financial concern or a major factor in assessing the course of the economy.'' Yes, at this point...
Meanwhile...many times, we have commented on derivative risk, artifically low interest rates, chasing yield which results in a lack of capital investment in domestic long term durable economic activity and the widening gap between the have's and have nots being facilitated by globalization...
Yesterday, NY Fed Head Geithner warned:
"gains (from derivatives) may have come at the price of increasing uncertainty and potential losses if we end up in the 'tail'"
- a bankers' term to describe the chance of a statistically rare event occurring.
"a substantial part of the world economy runs exchange rate regimes tied in some way to the dollar. This has entailed a sustained period of very substantial official accumulation of dollar reserves, putting downward pressure on U.S. interest rates and upward pressure on U.S. asset prices."
"distort-(ing) current decisions about investment and consumption in a way that could be detrimental to our longer-run growth prospects."
Obstacles to global economic integration:
"the long-term increase in income inequality, the slow pace of growth in real wages for the middle quintiles of the population, the increase in the volatility of income..., and the greater exposure of households to the risk in financing retirement and the burden of paying for health care."
Full speech
Remember our comment yesterday, regarding the debt as a % of GDP.... today, Benny & The Fed's reiterated: the U.S. faces a budget crisis unless Congress acts to the cut the federal deficit. ...
and... Bernanke said that the Fed along with the president's working group, aka PPT (Plunge Protection Team) which was formed in the wake of the 1987 stock market crash, had been closely monitoring market developments.
...if current corrections under way in housing and the amount of inventories being held by business stabilize in coming months, the economy should begin to rebound from its current slowdown by the end of the year... good luck on that one...
re: subprime lending "It's a concern, but at this point we don't see it as being a broad financial concern or a major factor in assessing the course of the economy.'' Yes, at this point...
Meanwhile...many times, we have commented on derivative risk, artifically low interest rates, chasing yield which results in a lack of capital investment in domestic long term durable economic activity and the widening gap between the have's and have nots being facilitated by globalization...
Yesterday, NY Fed Head Geithner warned:
"gains (from derivatives) may have come at the price of increasing uncertainty and potential losses if we end up in the 'tail'"
- a bankers' term to describe the chance of a statistically rare event occurring.
"a substantial part of the world economy runs exchange rate regimes tied in some way to the dollar. This has entailed a sustained period of very substantial official accumulation of dollar reserves, putting downward pressure on U.S. interest rates and upward pressure on U.S. asset prices."
"distort-(ing) current decisions about investment and consumption in a way that could be detrimental to our longer-run growth prospects."
Obstacles to global economic integration:
"the long-term increase in income inequality, the slow pace of growth in real wages for the middle quintiles of the population, the increase in the volatility of income..., and the greater exposure of households to the risk in financing retirement and the burden of paying for health care."
Full speech
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