We have been saying for a while now that the US Dollar is overdue for a bounce and the price action of the past week or so is starting to shape up as a possible launching pad for a more sustained rally.
December 16th, 2009 | Murray Dawes | 1 comment | ContinuedAll Posts Tagged With: "interest rates"
Volcker, the Last Central Banker in America to Have Any Real Integrity
He saw what needed to be done and he did it. He hiked up rates and brought consumer price inflation under control.
December 14th, 2009 | Bill Bonner | 4 comments | Continued
You Can Lead Investors to Liquidity but You Can’t Make Them Buy Stocks
Our version of this Christmas story is that a long-term bear market began in 2000. This was the fall-out from the dot.com boom and the end of an 18-year bull market in stocks that had begun in 1982. Left to its own devices, the market would have declined to more reasonable valuations and companies would have sorted out real ways to grow earnings.
December 14th, 2009 | Dan Denning | 2 comments | Continued
Greek Banks Playing the Carry Trade and Investing in Government Bonds
Another day, another country looks to be heading towards bankruptcy.
Greece was last night downgraded by ratings agency Fitch from A- to BBB+ and was placed on negative credit watch. That means there could be more downgrades to come.
The Greek budget deficit is currently 12% of GDP.
December 9th, 2009 | Murray Dawes | 3 comments | Continued
The Single Best Trade for 2010
What was the single, most damaging trade of 2009? There are a number of candidates: short stocks, short gold and long the dollar would all be in the running.
December 4th, 2009 | Steve Belmont | 0 comments | Continued
Feds Think They Have Won This Fight Against the Depression
The Wall Street Journal says they’ve turned their guns around. The Fed is a “Bubble Fighter” now, it reports.
December 4th, 2009 | Bill Bonner | 4 comments | Continued
Chinese Government Expected to Sign Off on Second Stimulus Package
Chinese bank lending and credit growth is already through the roof. Last year’s $685 billion stimulus program sent fixed asset investment in China much higher. It was, by most accounts, hugely supportive of resource prices, and thus most welcome in Australian resource circles.
December 4th, 2009 | Dan Denning | 8 comments | Continued
Fed and the Reverse Repo
The only way to exit is by the door the Fed came in. It barged into the market buying up toxic assets and Treasury notes and bonds. In order to get back out the door, it has to get rid of all the debt it gobbled up.
December 3rd, 2009 | Bill Bonner | 0 comments | Continued
A Date for an Aussie House Price Collapse
But we’ve done plenty of homework on the Aussie housing market. We’re either right or we’re wrong. Our forecast is not an option. There is no time decay. True, there may be people out there who are weighing up whether now is a good time to buy a house based on predictions about the direction of prices.
December 2nd, 2009 | Dan Denning | 251 comments | Continued
Are Aussie House Prices in a Bubble?
First off, house prices are still rising in Australia, but for the second month in a row sales are falling. Here in Melbourne, the average house price is now $510,000 according to the RP Data Index. Melbourne prices are up 15% since January. Granted, that’s not quite as good as the stock market this year. The All Ords is up nearly 30% year to date. But it’s not bad for houses is it?
December 1st, 2009 | Dan Denning | 103 comments | Continued
More Quantitative Easing by Fed has Markets Spooked About Inflation
Bullard said, that, “If the economy came in very weak, let’s say, in 2010, weaker than expected, we would have the option of doing further quantitative easing.” The Fed would do this through additional asset purchases, presumably with more, uh, “money” it created.
November 24th, 2009 | Dan Denning | 43 comments | Continued
Bond Scam Perpetrated by Money-grubbing Government
So how does a government fund its spending programs if global creditors begin to turn to other assets? Well, it can have its own central bank “monetise the debt.” But having the central bank buy government bonds with new money is a sure-fire path to currency depreciation and higher interest rates.
November 23rd, 2009 | Dan Denning | 2 comments | Continued
Homebuilding Goes Down While Economy Gathers Strength
Meanwhile, the news two days ago was that homebuilding took a dive in October. Work began on 11% fewer houses than the month before.
November 20th, 2009 | Bill Bonner | 1 comment | Continued
More Money in Cash Right Now Than Equity in U.S. Companies
Now, there is a very good reason investors are reducing their allocation to stocks. As we’ve said before, we think the equity premium – what people are willing to pay for stocks – is regressing to the mean. It was so high for so long because corporate cash flows in the second half of the last century benefitted so much from low interest rates and globalisation.
November 6th, 2009 | Dan Denning | 15 comments | Continued
Interest Rates and Inflation
And that’s the point. It is all money in the bank. There is, according to the press, a difference of opinion between Treasury and the Reserve Bank over interest rates and their proper direction.
November 3rd, 2009 | Dr. Steven Kates | 79 comments | Continued
