Tag: ben bernanke

Rates of Interest

Posted on by admin

As the 10-year to T-bill yield curve chart makes clear, we are not in Kansas anymore.  We are in Wonderland and as you can see, in Wonderland interest rates and their interrelationships are at the center of events.

tnx.irx

Last week the bullish case reasserted itself across financial markets, but to argue that policy makers are doing anything better than pumping future distortions into the system is crazy talk along the lines of 'the world is flat' or… ‘the above chart is flat’.

Last week Ben Bernanke clarified for people that yes indeed the Fed will eventually taper its QE bond buying operation while making clear that Zero Interest Rate Policy (ZIRP) will remain as is.  I think that the average market participant is starting to settle in and get comfortable with the terms of our 'Taper to Carry'(T2C) plan, which sees the banks benefiting from borrowing short and lending longer. Continue reading "Rates of Interest" →

If You Missed Today's Up-Move, Don't Blame Us

Posted on by The INO.com Team

If You Missed Today's Up-Move, Don't Blame Us

yeahInterestingly enough, 24 hours before Ben Bernanke made his announcement and spruced the markets up dramatically, MarketClub's Trade Triangle technology picked up buy signals on the DOW at 15,340.09 and on the S&P 500 at 1,654.19. These signals came in a day before today's huge move to the upside.

If you're not yet a MarketClub member, I'd like to invite you to take advantage of our special free trial so you can see what MarketClub can do for you. Remember, MarketClub covers stocks, futures, precious metals, ETFs, mutual funds and foreign exchange.

Here is the link you need to start your trial:

Every success in your own trading. GO

Adam Hewison
President, INO.com
Co-Creator, MarketClub

More jobs needed to taper bonds

Posted on by The INO.com Team

Many Federal Reserve members agreed last month that the job market's improvement would have to be sustained before the Fed would reduce its bond purchases, according to minutes of their June meeting. Several felt confident that a pullback in bond purchases could occur soon.

The minutes released Wednesday echo remarks Chairman Ben Bernanke made at a news conference after the meeting. Bernanke said the Fed would likely slow its bond purchases later this year and end them around mid-2014 if the economy continued to strengthen. The bond purchases have helped keep long-term interest rates low to spur spending.

Since the purchases began in September, the economy has added an average 204,000 jobs a month, up from 174,000 jobs in the previous nine months. Still, unemployment remains a high 7.6 percent.

The minutes showed that Fed members struggled with how best to convey the Fed's thinking about its timetable for bond purchases. Some wanted to explain it in the post-meeting statement. Others felt the statement might be misinterpreted. In the end, most participants thought Bernanke should lay out the Fed's thinking in his news conference _ and stress that any pullback in bond purchases would depend on the economic outlook. Continue reading "More jobs needed to taper bonds" →

Stocks edge lower as investors wait on Fed

Posted on by The INO.com Team

The stock market is waiting on the Fed.

Major indexes drifted lower in midday trading Wednesday as traders wondered what the Federal Reserve will say about the U.S. economy and the central bank's huge stimulus program this afternoon.

The U.S. central bank will release its latest policy update at 2 p.m. Eastern Daylight Time and Bernanke will speak at a press conference thirty minutes later. Comments by Bernanke last month suggesting the central bank may soon ease that support unsettled investors and caused this year's rally in stocks to stall.

"All eyes are on Bernanke and markets are being held hostage until he speaks," said Joseph Tanious, Global Market Strategist at J.P. Morgan Funds.

The Fed has been buying $85 billion of bonds a month to support an economy that is still struggling to grow faster following the Great Recession.

The Dow Jones industrial average fell 19 points, or 0.1 percent, to 15,298 as of 12 p.m. Eastern Daylight time. Continue reading "Stocks edge lower as investors wait on Fed" →

QE 'Taper' to T Bond 'Carry Trade'

Posted on by The INO.com Team

The following is the opening segment to this week’s premium letter, NFTRH 242.  The balance of #242 went on to discuss the technical status of US and global stock markets, key commodities, the current status of ‘inflation expectations’, precious metals and currencies; all in detail.

Taper to Carry

Last week we introduced the theoretical 'taper to carry' scenario whereby the Federal Reserve would indeed 'have the balls' to begin the end of traditional QE and transition the inflation via a new set of mechanics.  Mind you, we still get inflation under this scenario, but it would be less stealth and more honest and obvious to the public.  Here are the theoretical components of the play… Continue reading "QE 'Taper' to T Bond 'Carry Trade'" →