Daily Archive: Wednesday, February 27, 2008

Bernanke testimony

Mercantilism is alive and well Most telling statement when asked about what he wanted for the economy- moderate domestic consumption, more investment, and more exports to eliminate the trade deficit. (I’m looking for the transcript now to get the exact quotes.) This fits with the policy of a lower interest rates, lower ...Read More

2008-02-27 US Economic Releases

MBAVPRCH Index (Feb 22) Survey n/a Actual 358.2 Prior 357.6 Revised n/a While still winter numbers, this is nonetheless looking very weak. No way to tell if it’s more than loss of market share to banks, but other winter housing numbers are also weak. MBAVREFI Index (Feb 22) Survey n/a Actual 2458.9 ...Read More

Two quick comments on inflation

Bernanke may be reminded of the reason the dual mandate includes inflation – voters don’t like inflation even more than they don’t like unemployment. As inflation rates rises into the March 18 meeting, with the FF rate at 3% the real rate falls, which the FOMC sees as ‘easier’ policy. ...Read More

Additions to yesterday’s review

Forgot to include the influence of the 8,000 lb gorilla I’ve been advancing for the last few years! Supporting GDP Pension funds adding to allocations for passive commodity strategies Sources of inflation Pension funds adding to allocations for passive commodity strategies Pension funds contributing to the $ decline by allocating funds away ...Read More

Re: update

Dear Philip, Seems there’s a break between Mishkin and Kohn that previously wasn’t there. Markets are thinking Kohn supports a 50 cut and that he and Bernanke are alligned. Today Bernanke may show whether he leans towards Mishkin, the co academic, or Kohn, more the practitioner. Meanwhile, another ‘inflation day’ with oil ...Read More