Financial Markets
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Did the Fed Just Raise Interest Rates?
“In the Fed’s current floor system, the rate of IOR is the key tool of monetary policy. If the Fed raised the rate of IOR, then it raised interest rates.” ~ Thomas L. Hogan
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This Claim of Market Failure Deserves No Credit
“If you who claim to identify a market failure could, but don’t, voluntarily put your own money where your mouth is in an attempt to address that alleged failure, why should anyone listen to your pleas for government to coercively put other people’s money where your mouth is?” ~ Donald J. Boudreaux
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Sound Money Still Matters
“By making precious metals a more integral part of citizens’ lives, state gold depositories are key to a return to sound money.” ~ Peter C. Earle
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Is the Fed Paying Banks Not to Lend?
“The evidence shows that banks treated excess reserves as a profitable alternative to loans. High rates of IOER caused them to increase reserve holdings and decrease their loan allocations. The Fed was indeed paying banks not to lend.” ~ Thomas L. Hogan
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When Crowds Go Mad
“Much like his role model’s chief literary achievement, all is not well in this otherwise highly enjoyable book. Bernstein often resorts to simplified and unproved evolutionary just-so stories to account for the lunacy he colorfully describes.” ~ Joakim Book
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The Backward-Looking Storyteller
“History is slow, with fascinating moments and events scattered among tons and tons of mundane and inconsequential things. When we select some of them and weave them into an iconic story, we often make a mockery of the past – and ourselves a disservice.” ~ Joakim Book
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Pocket Monsters Meet Animal Spirits
“Lockdowns, boredom, and fiscal largesse sparked the incredible rise in Pokémon card values. But the Greater Fool Theory may already be at work.” ~ Peter C. Earle
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Lift Your Gaze, Please: the April Inflation Overshoot is Not the Problem
“A betting man, if he wants to remain a betting man, updates his priors. So, I side with Jason Bloom at the asset manager Invesco: ‘There is so much dislocation in the economy from the reopening and base effects from a year ago that it will take at least six to 12 months before we…
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To Lean, Clean, or Reign Supreme
“After a decade or more of economic and financial events that put central banks under heavy strain – financial collapse, a slow and timid recovery, the pandemic – strange things are again amiss in financial markets. Broda and Druckenmiller are right to say that ‘the Fed seems to be fighting the last battle.’ Ironically, so…
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War Of Words Over Inflation Stirs Questions for the Fed
“Does it make sense, for a nation founded on the notion of individual liberty, equality under the law, and personal property rights, to allow a government agency to manipulate the value of the currency used by its citizens? Would it be better to have a stable monetary foundation to facilitate free-market outcomes, rather than empower…
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The Lumber Market Delirium
“A sordid cocktail of Covid lockdowns and expansionary monetary policy have led to explosive conditions in long-docile lumber markets.” ~ Peter C. Earle
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The Everything Bubble and What it Means for Your Money
“The Everything Bubble is a grand illusion, money is growing more plentiful, credit more available. Asset prices are not really rising; it is the value of money which is being systematically undermined. I wonder whether the motto for this pandemic will be carpe diem, quam minimum credula pecunia – seize the day, place no trust…
