Monetary Policy

The Curious and Fallacious Case of the All-Powerful Fed


The Fed’s powers to impact the economy are overstated and overrated, in our view

Mr. Ordinary and the Wizards of Constitution Avenue


Meet Jerome Hayden Powell, the next Fed head.

Word Games With ECB Head Mario Draghi


Semantics are the only new thing about Thursday’s ECB decision to slow bond purchases.

The Fed’s Slimdown Is No SlimFast


The long-awaited balance-sheet unwinding has begun!

Minding the Fed’s (Possible) Unwinding


Fed balance sheet reduction doesn’t seem likely to materially impact stocks.

Fun With Uncle Milty


As the Fed tackles the case of the missing inflation, the late, great Milton Friedman has the answer.

Draghi, QE and the Perils of Timing Tapers


The ECB’s surprise inaction shows the folly of trying to game central bank moves.

The Fed’s Diet Plan


The Fed’s plan to reduce its balance sheet is amazingly gradual and the likely market impact amazingly small.

Now Hiring: The Federal Reserve


Does it matter whether President Trump picks advocates of rules-based policy?

The Folly of Fretting Fed False Fears


The Fed has spurred many false fears throughout the bull market. 

The Fed’s Balancing Act


The Fed is signaling well-ahead balance sheet reductions may be coming and, as with rate hikes and QE tapering, this should prove benign for markets.

The Only Article You Need to Read Before December’s Big Fed Meeting


Why a Fed rate hike should be fine for stocks.

Japanese Godzilla QE Shows Fed Mothra Feckless


If QE is the bee’s knees, why did no one tell the Japanese?

The Fed Says Lots of Words, Words, Words


Fed governors’ recent announcements don’t provide any more insight about the next interest rate hike.

Cozying Up to Negative Yields


Uncertainty tied to negative yields has fallen.

Yellen About a Whole Lot of Nothing


Once again, the Fed’s Jackson Hole jawboning yielded no useful insight.

The BoE’s Monetary Bazooka is a Squirt Gun


The BoE’s recent measures intended to boost growth likely won’t do very much, but that’s okay.

Hiring Lays an Egg: How Investors Should Approach US Unemployment


Friday’s disappointing US unemployment report should have little to no weight in your analysis of stocks’ direction.

MarketMinder Minute - Not So Negative Interest Rates


This MarketMinder Minute looks at negative interest rates and what they mean for the global economy.

Don’t Let the Yield Curve Flatten Your Spirits


A flatter yield curve doesn’t mean recession is around the corner.

The Curious Tale of Mario Draghi’s Helicopter


Inside the wacky world of “helicopter money.”

The Fed’s Bizarre Definition of “Transparency”


The Fed’s relatively new practice of publishing individual members’ forecasts isn’t adding transparency.

Negative Rates With a Small Positive Twist


The ECB offers an antidote to negative rate fears.

Sweden’s Central Bank Pushes Harder on String


Investors may be starting to notice central banks’ monetary gimmickry is misguided.

The Folly of Dissecting Fedspeak


The Fed never really penciled in four rate hikes this year.

Fed Rate Hike: Emerging Markets Edition


Rumors of the Fed’s impact on Emerging Markets are greatly exaggerated.

Do Rate Hikes Spell Trouble for Bonds?


Assessing the impact of rate hike cycles on fixed income investments.

Hip-Hip Hooray! The Fed Hiked


The US Federal Reserve announced a 0.25 percentage point rate hike Wednesday, the first since 2006.

MarketMinder Minute - Don’t Fear the Rate Hike


This MarketMinder Minute examines the impact of initial Fed rate hikes on stocks.

The Fed Can Still Do Its Job


The Fed’s new limits on emergency funding shouldn’t prevent it from acting as lender of last resort in a crisis.

The Next Big Fed Fear


First folks feared the end of quantitative easing, then the first rate hike. Up next: the shrinking of the Fed’s balance sheet.

Will the Fed Hike the Dollar Higher?


An initial Fed rate hike doesn’t automatically mean a stronger dollar.

The ECB’s Punch Bowl Has No Punch


More quantitative easing would sedate the eurozone, not stimulate it.

The Fed’s Fascinating Footnotes


What Janet Yellen didn’t say was more interesting than what she did. 

The Fed Passes. Again.


Six years and six months since the bull market began, the Fed still hasn’t hiked rates.

The Fruitless Folly of Forecasting the Fed


Forecasting Fed moves is an exercise in futility, as two financial writers illustrated Thursday.

Super Thursday Was Ordinary


The Bank of England served up more data, but rate hikes remain impossible to forecast.

Pundits Forecast Fed, Prove Forecasting Fed Is Folly


The media's mixed message on the Fed's deletion of patience illustrates the folly of Fed timing.

Fed People Write Words, Draw Dots


Once again, headlines read way too much into Fed communications. 

Congressmen Attempt to Invite Monetary Error, Fail


Has the Fed become politicized?

What Does This Messy Chart Say About Rate Hike Fears?


Here is the history of market action pre- and post-initial rate hike, in a very messy line graph.

Diverging to Normal


Do diverging global central bank policies really spell trouble for the bull market?

Cloudy, With a Chance of Rate Cuts?


Trying to guess what central bankers will do next is a fruitless endeavor. 

The ECB Will Buy Some Bonds


ECB QE is a thing and we expect similar results as the US, UK and Japanese versions: Misperceptions galore and little economic stimulus.

Data-Dependent Forward Guidance


How central bankers say they’ll act on economic data won’t tell you when the next rate hike is coming.   

Considerable Wrangling Over Considerable Time


Did the Fed just tell you when short-term rates will rise?

Fun With Mark and Janet


The punditry has taken to diagramming central bank chiefs’ sentences to figure out their next move. We do the same to show you why it’s all poppycock.

A Fun Fight With the Fed


Contrary to the old Wall Street saying, the Fed’s interest rate moves often mean little for stocks.

Should the ECB Go Big?


Is the ECB sleepwalking its way into a deflationary spiral?

Macroprudential Regulation: A New Way the Fed Can Fail


If only the Fed were a lot more boring.

Super Mario Strikes Again?


ECB President Mario Draghi threw out a slew of measures aimed at boosting eurozone growth and inflation Thursday—but landed far from the target in our view.

The Magic of Rising Rates


Interest rates are up, but so is household lending.

This Week in Monetary Policy


Some suggest the Fed’s decision to continue tapering disregards its negative impacts on Emerging Markets. In our view, a taper isn’t the problem—quantitative easing’s end will be a market positive.

Taper On


The small reduction in Fed bond buying is a step in the right direction, but likely not a big market mover.

Will Rising Rates Ding Demand?


Will rising long-term interest rates choke the US economy?

Britain's Secret Stimulus


The only QE left in Britain is Queen Elizabeth, and it seems their economy is better off for it.

Japan’s Quantitative Easy Button


Is Japan taking the easy way out with its uncompetitive economy?

An Open Letter to Janet Yellen


A quick reminder for Fed head nominee Janet Yellen: Simpler is often better.

Federal Reserve Chairman Nominated: Yellin’ About Yellen


Speculation abounds over monetary policy’s future with Janet Yellen in the Fed’s big chair—but history shows action often deviates from expectations.

Sept-Taper Caper


Despite media speculation the Fed would begin tapering asset purchases this month, the FOMC held off—at least for now.

Tracking the Third Arrow


While Japanese policymakers and headlines debate a forthcoming sales tax increase, Abenomics’ Third Arrow has seemingly gone by the wayside.

Chart Fest 2013!


If a picture says 1,000 words, here are 44,000 bullish words.

The Bizarro World of QE Taper Fears


As folks realize their QE tapering fears are false, their relief should propel stocks higher.

A UK Perspective on QE


Since the UK stopped asset purchases late last year, it has shown signs of a strengthening economy. In our view, tapering QE in the US likely brings similar results.

China’s Liquidity Finger Trap


China’s had a rough road lately, but the country’s financial growing pains and market wobbles appear unlikely to end the global bull market.



The Fed held steady at Wednesday’s meeting, but Chairman Ben Bernanke said QE may wind down later this year—a bullish outcome, in our view.

More than Fed-side Chatter


In our view, it’s harder to explain away a healthy US economy with Fed policy when overall US and global economic data are also steadily improving.

Tricky (Central) Bank Predicaments


The Fed and European Central Bank continued policies this week we view as counterproductive to their stated aims.

Abenomics Part 1, Version 2.0


The Bank of Japan seems poised to move forward with long-expected monetary easing plans.

Unintended Stress


Data from the FDIC show the Fed’s QE is arguably more stressful than the economic environment itself.

Youkoso, Kuroda-san?


Word has leaked Japanese Prime Minister plans to nominate Asian Development Bank chief Haruhiko Kuroda to steer the Bank of Japan. What can we expect from the likely new chief?

Easing, British-Style


The BOE passed on more quantitative easing—for now.

Shinzo Abe’s Unstimulating Stimulus


Japan’s new $117 billion stimulus package may provide a short-term boost, but it doesn’t address Japan’s long-running economic issues.

The Fed’s Commemorative Coin Collection


According to some, a $1 trillion platinum coin wouldn’t just be a sight to be seen—it’d be a solution for the US debt ceiling.

More on the Fed


Following more QE, it seems to us many in the media are worried about the Fed’s exit strategy when the entry strategy is actually more problematic.

Ken Fisher on the Fed’s Un-Stimulus


The Fed announced more quantitative easing Wednesday—which we think rather ill-advised.

An Equation to Shed Light on Inflation


Global central banks’ recent actions have some folks fearing hot inflation once again.

Let’s Do the Twist (and QE3)


The Fed announced QE3 and the continuation of Operation Twist Thursday, but what does it mean moving forward?

Boring Bernanke, Diligent Draghi


Friday, all eyes were on Jackson Hole, but the real action happened in Frankfurt.

Boring Bernanke, Diligent Draghi


Friday, all eyes were on Jackson Hole, but the real action happened in Frankfurt.

Central Banker Relay


Following Olympic swimming relays earlier this week, central bankers had their own relay on Thursday. But what impact will their actions (or lack thereof) really have?

Let’s Twist Again


The Fed announced it will extend Operation Twist through year end—but does it give investors a new reason to dance? 

Behind Global Bond Yield Gyrations


Amid rising rates globally, recently elevated Spanish and Italian yields Thursday might not mean what many folks think.

Pulling Back (the) TARP


Roughly three and a half years after its hotly debated birth, TARP’s bank bailout doesn’t seem much like the black hole many feared.

Leaping to Conclusions


Investors should beware allowing popular misconceptions and common media assessments to blindside them when it comes to assessing the economy’s and markets’ overall status.

Raising Flags Over the Eurozone


Greece continued to make incremental progress Thursday, and additional signs of the eurozone’s multispeed economy emerged.

These PIIGS Went to Market


A look at falling Italian and Spanish debt yields.

Forecasting Fed Forecasting


The Fed announced it will begin releasing its forecasts and longer-term plans for interest rates starting this month—but is this move positive, negative or somewhere in between?

An (Italian) Tale of Two Auctions


Italian debt auctions this week resulted in incremental improvements in yields to round out a bumpy 2011.

Bonds and Banks


Spanish yields, the ECB and Hungarian politics dominated European news on Tuesday.

Liquidity, Payrolls and Ratings, Oh My!


Wednesday was a busy day in headlines and markets alike. Here’s a look at some of the day’s more prominent stories.

Do Little Fed, Do Nothing Government


While the Fed took an incremental step intended to buoy the economy Wednesday, Congress seems committed to quite the opposite tactic—doing nothing.

The Fed’s Decreased Reserve


The Fed’s attempted to increase transparency recently—but has it succeeded, and has it had the intended impact?

Jawboning, Speculation and Hot Air


With the Fed holding its annual Jackson Hole symposium, talk of QE3 is escalating.

Golden Years


As the free-floating dollar turns 40, we survey the web’s reaction.

Half Full or Half Empty?


Debt ceiling dramatics came to a conclusion Tuesday, leaving many frustrated in its wake. Here’s a look around the news at what’s poking that frustration—and largely unnoticed remedies.

Fisher Investments on China’s Three Pillars


China is likely poised to avoid a hard landing and continue growing, but that doesn’t mean Chinese stocks are set to soar.  

QE2 Sets Sail


The curtain officially descended on QE2 Friday—but given the fanfare it was greeted with, its departure has been fairly quiet.

Waving the Fed’s Wand


Many seem to think the Fed has a magic wand it can wave to solve the economy’s woes. But folks seem to believe in monetary policy sometimes and not others.

Cue the Curtain for QE2?


With June’s arrival comes the last month of the Fed’s second round of quantitative easing purchases.

Indebted Europe


News out of Europe on Monday refreshed PIIGS worries.

Rumors and Bailouts


S&P once again downgraded Greece’s rating—but EU officials are likely to continue to provide financial support as necessary to avoid a collapse of the euro currency.

And Then There Were Three


Portugal announced preliminary details of its bailout package Wednesday. But are bailouts really the heart of the matter?

An Impasse Comes to Pass


Congressional Democrats and Republicans continue to battle over the budget.

A QE2 Quandary


The QE2 debate’s already begun, and unsurprisingly, officials and politicians are heavily divided on the subject.

Stressing Over Banks?


The Fed’s latest stress test will permit select banks to increase their dividends. Hooray! But are the tests asking the right question?



Lost amid the headlines, eurozone officials made positive strides in overhauling bailout fund terms—but there’s still plenty of work to do.

Distribution or Inflation?


Sharp food price swings are stoking inflation in some countries, but monetary policy likely isn't the answer.

Chinese Inflation Conundrum


China's attempt to avoid overheating without imperiling growth is a timely reminder of the diversity of Emerging Markets countries.

Classic Divergence

The Fed remained cautious in their most recent policy statement even as retail sales confirmed continued economic recovery on the verge of renewed expansion.

Black Friday Not So Bleak

Irish bailout details failed to calm European nerves, but US investors managed to shake off some of the gloom on encouraging Thanksgiving retail sales. 

In Queue, QE2

The question of will they or won't they is falling wayside to questions over how much?

Lowering the Economic Bar

Fed Chief Ben Bernanke's testimony revealed a weaker outlook for growth—but also expectations for a continued recovery.

Greece Got Your Goat?

Greece is once again making headlines, with government bond yields hitting historical highs this week.

A Fed Surprise


The Fed raised the discount rate Friday—a baby step toward normalizing monetary policy.

Ben There. Done That. Now Let's Do It Again.

Senators are dragging their feet over Fed chair Bernanke's confirmation vote, but it's very likely he'll get another term.

A Limiting Proposal

President Obama proposed further regulation of large financial institutions on Thursday, but lacking details, sent markets into a tailspin.


The European economy overall continues to show signs of recovery.

Exits in Sight

That some countries are mulling stimulus exit plans is a positive sign the global economic recovery has legs.

Back From the Brink

A year after financial panic compelled the Treasury to insure money market funds, the program peacefully expired last Friday.

FDIC Out of Cash?

The financial crisis was a big test, but there's little need to fear the FDIC will run out of money—even as bank failures continue rising.

The Monetary Punch

Inflation's absence tells us the Fed's monetary punch is mixed just right. 

Juggling Hats

Fed Chairman Ben Bernanke detailed current and future monetary policy in congressional testimony and a Wall Street Journal editorial Tuesday.

Coping With Stress

The government is expected to announce the delay (perhaps a permanent one) of the Legacy Loans Program.

Extreme Makeover: Bank Edition

Last Thursday's failure of BankUnited was the largest bank failure of 2009, but there's no need to panic.

Chucking Darts

Don't fret the recent rise in long-term US Treasury yields.

Head Scratchers

Beltway bumbling remains a risk to bank stocks but doesn't preclude a broader market recovery.

A Fed to Be Reckoned With

The Fed proved it's a force to be reckoned with, unveiling three additional strategies injecting up to an additional $1.15 trillion into capital markets.

Little Air in Deflation Fears

Deflation is a near-term risk worth watching, though a severe deflationary spiral is unlikely to take hold in 2009.

Hop, Skip, and Jump

What's the right pace for monetary stimulus? The answer is not yet certain, though it's likely a severe financial crisis needs an aggressive response.

Proceeding Aggressively With Caution

Fed policy makers will likely exhibit both force and caution in their scheduled meetings this week.

Our Erratic Queen

Rapidly falling prices have many worried about deflation.

Tooling Around

Cutting the federal funds rate is just one monetary policy tool of many.

Fighting the Financial Crisis

Central banks and governments around the world have taken up the call to arms.

Much Ado About Nothing

Everyone knew the Fed would hold rates steady—what folks really cared about was what the Fed said.

Mark It to Market?

Freddie and Fannie may be proxies for Financials woes in many ways, including in the distortions of mark-to-market accounting.

Global Inflation Conflagration

Don't fret inflation shock stories—global inflation remains benign.

A Design for Life

The Bank of England is redecorating, and the US Fed is their interior designer of choice. What do the new curtains look like?

Two Roads Diverged

Global central bank activity abounded yesterday. While worth noting, such small moves don't matter much.

Surveying Lending

The recent Loan Officer Survey paints a dour picture on lending, but a closer look reveals far different results.

Super Ben, Part Deux

As the FOMC prepares to meet, the media predicts they'll drop rates again to help "save” the economy from a credit crunch. We continue to view credit crisis fears as overblown and largely psychological.


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