Meta tags:
Headings (most frequently used words):
january, 2015, excerpt, the, thursday, wednesday, tuesday, monday, oil, blog, ecb, for, us, economy, is, will, super, so, 500, price, fed, friday, 30, 29, 28, 27, 26, 22, 21, 20, 15, 14, 13, 12, search, translate, archive, how, world, works, has, challenge, ups, downs, global, showing, some, signs, of, life, mostly, about, depressing, euro, qe, work, regulators, end, shanghai, high, don, bet, against, consumers, dr, copper, turning, bearish, nine, reasons, why, bond, yields, are, falling, commodity, cycle, wasn, mixed, employment, report, transportation, stocks, boosted, by, lower, earnings, holding, up, despite, plunge, drowning, in, happy, new, year, far,
Text of the page (most frequently used words):
the (438), and (103), that (76), for (75), year (61), oil (52), share (50), this (42), more (42), last (41), are (37), #january (34), was (33), from (32), during (32), down (31), excerpt (30), december (29), their (27), may (26), has (26), will (25), since (25), prices (25), price (24), bond (24), with (24), have (23), 2015 (22), november (20), 500 (20), earnings (20), high (20), yardeni (20), eurozone (20), they (19), inflation (19), euro (18), rose (18), today (18), than (18), been (18), fed (18), october (17), new (17), end (17), global (17), comments (17), posted (17), economy (16), pinterest (16), facebook (16), blogthis (16), email (16), index (16), china (16), morning (16), briefing (16), april (15), september (15), super (15), yields (15), consumer (15), subscribers (15), debt (15), february (14), march (14), july (14), commodity (14), copper (14), ecb (14), which (14), but (14), record (14), there (14), central (14), employment (13), consumers (13), some (13), confidence (13), also (13), yesterday (13), market (13), much (13), yield (13), growth (13), june (12), august (12), about (12), through (12), 2008 (12), its (12), energy (12), sector (12), trillion (12), banks (12), lower (11), cycle (11), falling (11), world (11), over (11), rate (11), plunge (11), not (11), other (11), easy (11), months (10), while (10), continue (10), data (10), still (10), could (10), zero (10), economic (10), drop (10), were (10), 2014 (9), despite (9), how (9), month (9), should (9), low (9), per (9), production (9), industry (9), money (9), financial (9), forward (9), rates (9), monetary (9), japan (9), stocks (8), too (8), recent (8), bonds (8), around (8), according (8), barrel (8), between (8), now (8), following (8), out (8), spending (8), after (8), demand (8), week (8), light (8), government (8), stock (8), start (8), 2011 (7), why (7), gain (7), said (7), get (7), real (7), dollar (7), interest (7), producers (7), shale (7), one (7), because (7), rather (7), many (7), would (7), supply (7), all (7), raising (7), sales (7), program (7), deflation (7), soared (7), what (7), draghi (7), transportation (6), 2016 (6), see (6), business (6), already (6), wage (6), billion (6), fall (6), again (6), investors (6), current (6), can (6), hedges (6), however (6), well (6), decade (6), stagnation (6), industrials (6), margin (6), 000 (6), strong (6), boost (6), time (6), labor (6), patient (6), years (6), then (6), seems (6), two (6), exports (6), goods (6), loans (6), might (6), boj (6), 2012 (5), happy (5), boosted (5), shanghai (5), works (5), investment (5), home (5), million (5), best (5), various (5), measure (5), late (5), bullish (5), survey (5), dropped (5), lowest (5), quarter (5), before (5), back (5), mess (5), another (5), monday (5), crude (5), whatever (5), does (5), costs (5), fell (5), target (5), companies (5), below (5), capital (5), these (5), big (5), german (5), focus (5), weight (5), rated (5), result (5), yet (5), secular (5), under (5), wednesday (5), along (5), lots (5), economies (5), retail (5), let (5), likely (5), fomc (5), raw (5), remains (5), germany (5), ppi (5), ultra (5), policy (5), both (5), enough (5), mario (5), bank (5), orders (5), continues (5), yen (5), crisis (5), borrowers (5), liquidity (5), doing (5), 2013 (4), far (4), drowning (4), wasn (4), nine (4), reasons (4), against (4), depressing (4), showing (4), blog (4), our (4), president (4), research (4), way (4), payroll (4), bloomberg (4), highest (4), cyclical (4), percentage (4), jobs (4), hard (4), highly (4), correlated (4), did (4), gdp (4), msci (4), 2009 (4), saudi (4), long (4), take (4), any (4), number (4), analysts (4), started (4), when (4), reported (4), borrowing (4), risk (4), takes (4), just (4), plunging (4), article (4), tuesday (4), past (4), forecasts (4), scenario (4), getting (4), responded (4), first (4), very (4), into (4), job (4), thursday (4), private (4), words (4), force (4), less (4), crb (4), spot (4), friday (4), capacity (4), show (4), decline (4), rising (4), currencies (4), chaos (4), chinese (4), revive (4), given (4), currency (4), beginning (4), problem (4), narrowed (4), previous (4), holding (3), report (3), turning (3), don (3), bet (3), regulators (3), work (3), mostly (3), life (3), great (3), economics (3), service (3), posts (3), everyone (3), starting (3), average (3), hourly (3), gasoline (3), windfall (3), weekly (3), jumped (3), reading (3), increase (3), remain (3), stronger (3), game (3), minister (3), opec (3), make (3), lowers (3), even (3), war (3), biggest (3), members (3), them (3), policies (3), future (3), bankers (3), hand (3), boom (3), slashing (3), exchange (3), goldman (3), output (3), coming (3), glut (3), peaked (3), fear (3), longer (3), excluding (3), sharply (3), plunged (3), consensus (3), estimates (3), led (3), lowering (3), quickly (3), half (3), profit (3), impact (3), small (3), gains (3), disappointing (3), caused (3), jump (3), 1999 (3), latter (3), most (3), part (3), encouraged (3), workers (3), signal (3), solid (3), instead (3), industrial (3), forecast (3), especially (3), near (3), set (3), bust (3), weaker (3), 2004 (3), forex (3), markets (3), know (3), officials (3), going (3), trading (3), addition (3), yuan (3), bubble (3), though (3), buy (3), without (3), core (3), major (3), like (3), three (3), ytd (3), lending (3), done (3), same (3), japanese (3), housing (3), losing (3), spread (3), maxed (3), ability (3), financed (3), qqe (3), mixed (2), bearish (2), signs (2), ups (2), downs (2), challenge (2), providing (2), 200 (2), news (2), boosting (2), measures (2), ending (2), 2007 (2), turned (2), state (2), buying (2), present (2), situation (2), unemployment (2), spend (2), revised (2), showed (2), targeting (2), 2300 (2), zombies (2), soaring (2), freefall (2), brent (2), peak (2), next (2), significant (2), arabia (2), ali (2), naimi (2), term (2), cut (2), whether (2), rise (2), gulf (2), countries (2), range (2), declared (2), consider (2), titled (2), test (2), patience (2), until (2), insurance (2), barrels (2), budgets (2), pay (2), almost (2), projects (2), day (2), suggest (2), soon (2), hunch (2), rig (2), count (2), grexit (2), north (2), gets (2), keep (2), frackers (2), pumping (2), expected (2), trigger (2), weighing (2), here (2), dropping (2), quite (2), based (2), overall (2), gross (2), warning (2), stimulating (2), party (2), decouple (2), odds (2), harder (2), where (2), second (2), adp (2), augur (2), gushing (2), texas (2), firms (2), advanced (2), wages (2), doesn (2), drive (2), higher (2), review (2), revisions (2), widely (2), expecting (2), hasn (2), evans (2), member (2), hurt (2), heading (2), weakness (2), averting (2), roughly (2), trade (2), expanded (2), mired (2), slowed (2), france (2), manufacturing (2), consecutive (2), weakest (2), metals (2), heavy (2), commodities (2), asset (2), barometer (2), curve (2), auction (2), widespread (2), move (2), shortage (2), slow (2), factors (2), good (2), imports (2), indicator (2), activity (2), base (2), metal (2), indicators (2), maybe (2), attributable (2), possible (2), among (2), four (2), including (2), mine (2), american (2), adjusted (2), flags (2), excess (2), put (2), noted (2), cpi (2), means (2), volatility (2), yes (2), downside (2), wants (2), vote (2), sell (2), flattening (2), banking (2), released (2), rules (2), entrusted (2), company (2), unknown (2), latest (2), defaults (2), hit (2), really (2), foreign (2), purchases (2), loss (2), burden (2), losses (2), national (2), restructuring (2), maturities (2), plummeted (2), close (2), only (2), lift (2), skeptical (2), quantitative (2), easing (2), thanks (2), imf (2), outlook (2), credibility (2), meanwhile (2), ben (2), bernanke (2), dark (2), ended (2), continued (2), darkness (2), side (2), drachma (2), mark (2), possibility (2), summer (2), talking (2), his (2), emu (2), stimulative (2), open (2), lowered (2), likelihood (2), offset (2), six (2), seem (2), starts (2), houston (2), dallas (2), vertically (2), gloomy (2), suggests (2), producing (2), durable (2), machinery (2), leading (2), pushing (2), mid (2), sum (2), introduction (2), converge (2), distinguished (2), credit (2), different (2), union (2), spanish (2), italian (2), versus (2), comparable (2), spreads (2), widened (2), significantly (2), pledged (2), defend (2), attempts (2), failed (2), effectiveness (2), solution (2), bang (2), decades (2), deflationary (2), want (2), reduce (2), debts (2), abenomics (2), chair (2), committee (2), fiscal (2), center (2), powered, blogger, copyright, hedge, clause, 194, 196, 195, 193, plun, 152, 2017, 2018, 2019, 2020, 2021, archive, please, improved, app, website, chart, rooms, chief, strategist, inc, provider, independent, strategy, highlights, excerpts, designed, professionals, translate, search, twitter, page, follow, subscribe, atom, older, newer, isn, certainly, such, 2006, pced, annualized, level, climate, component, respondents, who, tends, mood, contributing, points, wonder, ata, trucking, freight, tonnage, intermodal, railcar, loadings, santa, early, dow, theory, kings, inclined, agree, argue, retest, bouncing, outperform, imitation, comfort, ongoing, unsettling, 115, support, persist, never, 100, told, sense, him, russians, brazilians, hold, indefinitely, contrast, injured, felt, pain, reuters, revamped, key, point, nerves, powerhouses, intensifies, counting, upstart, rivals, lose, thing, shielding, crashing, need, reckon, those, moving, wait, run, racing, revamp, cashing, placed, hedged, consultants, familiar, deals, ran, tests, notes, above, largest, drillers, faster, expansion, statements, filed, securities, commission, 1tn, brutal, nearly, sachs, warned, cancellation, developments, deprive, cent, findings, sent, tumbling, vanish, majors, delay, ticket, lifeblood, petrol, supplies, heating, fuels, chemicals, tell, rapidly, 609, 482, déjà, making, comeback, talk, answer, prize, auto, related, industries, stress, middle, east, sectors, analysis, aggregate, values, weeks, edged, standard, poor, provides, each, estimate, bungee, rolling, lately, fuel, endgame, irrational, exuberance, winner, few, bls, humming, dakota, sign, trouble, jobless, claims, direct, respect, larger, account, ditto, emerging, overweight, machine, indeed, solidly, 240, workweek, unchanged, hours, earned, income, proxy, flatten, pace, incomes, calendar, upward, totaling, former, 261, 353, 119, household, fluctuated, evidence, obamacare, feared, mean, endorsing, impressed, resilience, washington, meddling, 273, dropouts, 456, economists, tightened, people, reenter, easier, happened, unemployed, fairy, godmother, godfather, charles, influential, normalization, looking, you, meeting, wrong, direction, noise, wild, catastrophe, full, numerous, occasions, argued, lasted, include, petroleum, troughed, 214, 2001, coinciding, joining, organization, 198, 638, bound, approximately, 550, 490, breakdown, driven, ever, increasing, recession, structural, highs, spain, 32nd, monthly, materials, ferrous, class, edge, indicating, stormy, weather, prince, slicing, dicing, ball, treasury, taper, terminate, qe3, chatter, rotation, discussed, using, headings, portfolio, rebalancing, fund, inflows, europe, subdued, safe, havens, dividend, yielding, ones, look, attractive, won, surprised, retests, overseas, sweden, previously, shown, trend, trends, age, wave, old, variables, owners, feeling, openings, voters, williams, lockhart, men, worldwide, accentuating, positives, includes, scrap, nearby, futures, perceived, phd, view, fears, sudden, dearth, gluts, observed, worst, performer, shed, value, straight, oversupply, mines, sierra, gorda, chile, inaugurated, adding, constancia, begin, operations, peru, looks, add, fast, recently, green, yellow, red, breaking, turns, fundamental, wsj, positive, spin, numbers, downward, saar, assumed, fact, sentiment, expectations, components, trauma, haunts, dip, worse, nothing, hate, junk, iran, negative, switzerland, curves, abroad, sniper, think, suffers, properties, pollution, corruption, campaign, instilled, probably, contributed, property, cooling, residential, estate, reduced, rollers, macau, gamble, gamblers, shenzhen, 300, clamped, bounced, restrictions, regulator, draft, curb, type, loan, surged, forms, shadow, forbid, use, equity, 458, stabilized, eased, neighbor, upstairs, consequences, known, freefalling, iranian, says, calamity, petrobras, houthis, yemen, killed, experiment, devaluation, shoe, detail, explicit, purpose, favored, area, interesting, handle, sharing, sovereign, bought, lie, individual, states, ideas, exact, role, play, apply, pursue, default, obliged, country, freedom, sorts, obvious, didn, perhaps, moved, doubt, mission, accomplished, opinion, transmission, mechanism, fewer, suppose, experience, headline, magic, fighting, rosengren, rush, raise, canadian, surprise, boe, unanimous, headwinds, futility, lord, nzirp, earth, lit, recovery, dragi, rally, hopes, region, avert, replace, currently, believer, willing, tunnel, 2003, deutsche, expect, parity, began, speculate, fundamentals, better, ago, weighted, soar, euros, lackluster, outpacing, dollars, demonstrated, nominal, debatable, lifts, king, paying, privilege, betting, shock, awe, greeks, stats, stagnating, performance, derby, birdman, press, conference, bit, skepticism, surprises, upside, balance, question, devaluations, particular, exporters, suffer, greenback, strengthen, building, upbeat, ifo, 103, 106, sanctions, imposed, russia, merchandise, improvement, overdone, cents, pound, selloff, stabilize, selling, traders, lightening, positions, lunar, holiday, begins, businesses, shut, sheep, markit, flash, pmi, wells, homebuilding, yergin, explains, swingers, free, saudis, learned, mortgage, lifting, weak, nondefense, category, declined, construction, mining, farm, impressive, 102, agreeing, series, field, having, hotter, ready, 120, 130, 2150, several, waiting, usual, season, upturn, dead, euphoric, yearning, questions, doubles, exceeds, resulting, greek, death, messing, revived, increasingly, flood, measured, non, gold, international, reserves, held, plus, holdings, treasuries, agencies, 116, official, historical, lows, deleveraging, enabled, borrow, services, expand, lost, consumption, enabling, stay, mounting, pressures, programs, spreading, forces, populist, politicians, gaining, power, particularly, greece, governments, austerity, countrymen, accumulated, called, couple, forcing, lenders, extend, haircuts, accept, course, option, stake, heart, destroy, beats, road, recognizing, inadvertently, created, triggering, undeclared, aren, aimed, driving, contribution, devalue, pushed, announced, had, anticipated, fretting, brief, stroll, memory, lane, recall, got, provided, 1980s, alan, greenspan, tech, 1990s, janet, yellen, recovered, finally, aiming, further, corporate, profits, causing, preference, increases, either, none, hiking, reiterated, assessment, judges, normalize, stance, word, ambiguous, considerable, phrase, upsetting, large, stimulus, lend, freely, introduced, policymakers, succeeded, devaluing, distorting, bad, watchers, watching, swiss, style, finds, jgbs, pboc, statement, media, linkedin, articles,
Text of the page (random words):
exchange market triggering an undeclared currency war the central bankers have declared that their ultra easy monetary policies aren t aimed at driving down their currencies but that s what they are doing the bank of japan s contribution to abenomics was to devalue the yen with its qqe program the currency plunged 34 from september 13 2012 through yesterday ecb president mario draghi started talking the euro down late last summer and pushed it lower with the qe program announced last week the euro is down 19 from last year s high on may 6 commodity currencies are plunging around the world because the commodity super cycle wasn t as super as many producers had anticipated when they expanded their capacity instead of fretting over where this is all leading let s take a brief stroll down memory lane to recall how we got here 1 fed the fed provided lots of easy money since the late 1980s under fed chair alan greenspan the result was a bubble in high tech stock prices during the late 1990s and a housing bubble during the previous decade under fed chair ben bernanke and now janet yellen bond and stock prices have soared home prices have recovered the economy finally seems strong enough that fed officials are aiming to start raising interest rates at mid year the problem is that the soaring dollar is pushing inflation further below the fed s 2 target in addition it is depressing corporate profits causing companies to reduce their labor costs which may continue to keep wage inflation around 2 below the fed s 3 4 preference this increases the likelihood of either one and done or none and done for rate hiking this year yesterday s fomc statement reiterated based on its current assessment the committee judges that it can be patient in beginning to normalize the stance of monetary policy the word patient is ambiguous enough that the fomc dropped the considerable time phrase without upsetting the markets yesterday 2 ecb the introduction of the euro at the start of 1999 caused bond yields to converge in the eurozone as investors no longer distinguished between the credit risk of the different members of the monetary union the spread between both spanish and italian government bond yields versus the comparable german yield narrowed to zero during the previous decade spreads widened again at the beginning of the current decade but narrowed significantly after mario draghi pledged to do whatever it takes to defend the euro on july 26 2012 ecb data show that loans to the eurozone private sector soared by 4 0 trillion to a record 11 1 trillion from the start of 2004 through the end of 2011 as of november 2014 this debt measure was down to 10 4 trillion in other words the ecb s various attempts to revive lending since the financial crisis have failed that might be because borrowers are already maxed out on their ability to service more debt 3 pboc the chinese responded quickly to the financial crisis of 2008 with a large fiscal stimulus program and lots of easy money banks were encouraged to lend freely which they did bank loans soared by 8 9 trillion from the end 2008 to a record high of 13 3 trillion at the end of last year yet china s economic growth continues to slow as the economy gets less bang per yuan of borrowing 4 boj last wednesday the boj monetary policy committee cut its core inflation forecast to 1 0 for the fiscal year starting in april from 1 7 despite the latest qe introduced on april 4 2013 and then qqe october 31 2014 under abenomics japan s monetary policymakers can t seem to get core inflation up to 2 the boj has succeeded in devaluing the yen and boosting stock prices but it is distorting the bond market thanks to qqe purchases by the boj the japanese 10 year government bond yield was down to only 0 28 yesterday the 30 year yield was 1 29 the flattening of the yield curve near zero is bad news for financial companies especially insurance companies and banks already some forex watchers are watching out for a swiss style jump in the yen if the boj finds that it s getting harder to buy jgbs because no one wants to sell them posted by dr ed yardeni at 9 35 am no comments email this blogthis share to x share to facebook share to pinterest thursday january 29 2015 the ecb has a challenge excerpt the introduction of the euro at the start of 1999 caused bond yields to converge in the eurozone as investors no longer distinguished between the credit risk of the different members of the monetary union the spread between both spanish and italian government bond yields versus the comparable german yield narrowed to zero during the previous decade spreads widened again at the beginning of the current decade but narrowed significantly after mario draghi pledged to do whatever it takes to defend the euro on july 26 2012 ecb data show that loans to the eurozone private sector soared by 4 0 trillion to a record 11 1 trillion from the start of 2004 through the end of 2011 as of november 2014 this debt measure was down to 10 4 trillion in other words the ecb s various attempts to revive lending since the financial crisis have failed that might be because borrowers are already maxed out on their ability to service more debt today s morning briefing how the world works 1 two big questions 2 global liquidity doubles since start of 2009 3 easy money losing its effectiveness 4 debt financed supply exceeds debt financed demand resulting in deflation 5 central banks doing more of the same and producing more secular stagnation and deflation 6 the greek solution to too much debt 7 the death of the debt super cycle 8 central banks messing with currency war 9 the patient fed 10 too many maxed out borrowers in eurozone 11 less bang per yuan 12 profit margin review more for subscribers posted by dr ed yardeni at 12 05 am no comments email this blogthis share to x share to facebook share to pinterest wednesday january 28 2015 ups downs for the us economy excerpt yesterday was another up and down day for the us economy on monday we learned that january s dallas fed business survey suggests that the plunge in the price of oil is depressing texas the biggest oil producing state in the us on the other hand plunging mortgage rates are lifting housing starts yesterday it was more of the same durable goods orders were weak while new home sales were strong nondefense capital goods orders fell 0 6 for the second month during december the weakest category is machinery orders which declined 9 4 during the past four months leading the way down are orders for construction industrial mining and farm machinery on the other hand december s new home sales data released yesterday showed a solid gain of 11 6 m m to a new cyclical high even more impressive is the big jump in the consumer confidence index this month it soared from 93 1 last month to 102 9 this month the highest since august 2007 there was a significant drop in the percentage of consumers agreeing that jobs are hard to get to 25 7 the lowest since march 2008 this series is highly correlated with the unemployment rate if oil field workers are losing their jobs that s not having any impact on consumer confidence which suggests that the job market is getting hotter today s morning briefing yearning for earnings 1 get ready set go 2 the 120 130 scenario 3 lowering s p 500 target to 2150 this year and pushing 2300 to mid 2016 4 several factors weighing on earnings 5 not a zero sum game 6 still waiting for usual earnings season upturn 7 industry analysts slashing 2015 and 2016 estimates 8 margin estimates falling 9 energy remains the biggest dead weight 10 durable goods are also heavy 11 consumer confidence is euphoric 12 focus on market weight rated s p 500 industrials more for subscribers posted by dr ed yardeni at 12 05 am no comments email this blogthis share to x share to facebook share to pinterest tuesday january 27 2015 global economy showing some signs of life excerpt everyone s been down on the global economic outlook both the imf and world bank have lowered their global growth forecasts for 2015 and 2016 there has been quite a bit of skepticism about the likelihood that ultra easy monetary policies in japan and now the eurozone will do much to lift their economies i have been skeptical as well however i am open to the possibility that surprises may be to the upside rather than the downside on balance the plunge in oil prices should be stimulative for the global economy the same can be said for the plunge in bond yields the question is whether the devaluations of the yen and the euro will boost exports in japan and the eurozone maybe so but their gain could be some other economies loss in particular us exporters could suffer if the greenback continues to strengthen however that could be offset by stronger us consumer spending and home building in this light consider the following upbeat indicators 1 germany germany s ifo business confidence index rose for the past three months through january from 103 4 to 106 7 that s after falling for six consecutive months the sanctions imposed on russia seem to have hit germany hard last year now the falling euro may be starting to boost german exports 2 japan japanese merchandise exports in yen rose 2 0 m m and 12 9 y y during december to the best reading since september 2008 3 copper given the improvement in us housing starts german business confidence and japanese exports the recent freefall in the price of copper may be overdone yesterday it rose 4 cents to 2 54 per pound my hunch is that the selloff may be over and the price should stabilize for a while yes but what about china some of the recent copper selling might have been attributable to traders lightening their positions before the chinese lunar new year holiday begins on february 19 most businesses are shut from february 18 24 2015 is the year of the sheep by the way markit reported that china s flash m pmi output index rose from 49 9 during december to 50 1 in january the highest in three months today s morning briefing houston s problem 1 houston has a problem 2 us oil wells still gushing 3 dallas fed survey showing weakness 4 us consumer confidence going vertically up as gasoline prices go vertically down 5 homebuilding boom could offset oil industry bust 6 is the gloomy consensus on global economy too gloomy 7 yergin explains it all 8 oil shale frackers are the new swingers 9 the free market vs the saudis 10 focus on market weight rated s p 500 energy more for subscribers posted by dr ed yardeni at 12 05 am no comments email this blogthis share to x share to facebook share to pinterest monday january 26 2015 q is mostly about depressing the euro excerpt in the beginning the lord said let there be light and there was light then in 2008 ben bernanke said let there be nzirp and qe and the earth s dark financial chaos ended as near zero interest rate policy and quantitative easing lit the way to recovery last week mario dragi said let there be q and the euro continued to plunge eurozone stocks continued to rally on hopes that q will revive the region s economy and avert deflation if it works light will replace darkness in the eurozone currently i m not a believer but i am willing to move from the dark side to the light side if i see some light at the end of the eurozone s economic tunnel the euro plummeted to 1 12 on friday the lowest since september 17 2003 and down 20 from last year s high of 1 39 on may 7 now that the euro is trading more like the drachma than like the deutsche mark everyone seems to expect that it is heading for parity with the dollar which would be a 28 decline from last year s high i began to speculate about that possibility last summer as i ve noted before draghi first started talking the euro down at his 8 7 press conference last year in his q a comments he said that the fundamentals for a weaker exchange rate are today much better than they were two or three months ago meanwhile the trade weighted dollar continues to soar rising 2 4 since the start of the year and 13 6 since last year s low on july 1 the emu msci in euros is now up 7 8 ytd following last year s lackluster gain of 2 3 it is outpacing the us msci which is up 1 6 ytd following last year s 11 1 rise however the emu msci in dollars is up just 0 3 ytd following last year s drop of 10 2 as was demonstrated in the us and japan qe is bullish for stocks but its stimulative impact on nominal gdp remains debatable today s morning briefing q 1 after the darkness there was light 2 euro is trading more like drachma than d mark 3 qe still lifts stock and bond prices 4 good to be a bond king 5 paying for the privilege of lending money 6 still betting on one and done 7 draghi s shock and awe 8 open ended q 9 greeks vote while ecb does not 10 eurozone stats still mostly stagnating 11 performance derby 12 birdman more for subscribers posted by dr ed yardeni at 12 05 am no comments email this blogthis share to x share to facebook share to pinterest thursday january 22 2015 will qe work for ecb excerpt today the ecb will detail a new qe program for the explicit purpose of averting deflation bloomberg reported yesterday that ecb president mario draghi favored spending as much as 1 1 trillion through asset purchases of 50 billion a month until december 2016 according to two euro area central bank officials it will be interesting to see how the qe program will handle loss sharing according to an article in the 1 19 ft it is very likely that much of the burden for losses on sovereign bonds bought under qe will lie with individual member states though there are various ideas about the exact role the national central banks will play the losses are set to apply should a government pursue a debt restructuring or a default the national central banks would be obliged to buy as much of their country s debt as the ecb orders though they may have some freedom over the sorts of maturities they buy it s not obvious that qe will revive inflation in the eurozone given that it didn t do so in the us perhaps inflation would have moved lower in the us without qe though i doubt it given that government bond yields have plummeted close to zero in the eurozone qe s mission has already been accomplished in the bond market in my opinion the only transmission mechanism that i see between qe and inflation is through the currency if the euro continues to plunge as a result of the new qe program then the eurozone s economy might get a lift from exports and fewer imports that could boost inflation i suppose however i remain skeptical given japan s recent disappointing experience with quantitative easing meanwhile inflation continues to fall in the eurozone thanks to falling oil prices the headline cpi inflation rate was 0 2 y y during december the core rate was 0 7 today s morning briefing qe futility 1 the magic inflation target 2 imf lowers inflation outlook 3 despite ultra easy money central banks fighting deflation 4 rosengren is in no rush to raise...
|
