The future US yield curve as well?
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The central bank emphasizes that the program has only broad goals such as supporting interest rates and reducing risk premiums, rather than supporting financial markets.
I think that Central Bankers are planning to transform 2012/2022
live 1972/1892 … High Managed Inflation & Real Interest Negative
to de-valuate the Over-Debt (Public+Private) that it’s IMPOSSIBLE to re-pay with Standard Policy (Cuts&Tax).. the only other scenario is Chain-Default (first Europe, but then Us/Gbp/Jpy)..
PS: and may be the Stocks will re-peat the ’70 decade.. Nominal that doesn’t deep under the ’80 … with Real that deep under ’80..
People continue to talk about the differences between the US and Japan but the US yield curve is a steamroller (like Japan) that will not stop til you see a major shift in economic policy and it seems we are far from there.
Warren, do you see any positives / negatives from the socialist win in France. Clearly they are against austerity and talk of Eurobonds but do you see this coming to anything meaningful or is Germany just too strong. Thanks
WARREN MOSLER Reply:May 8th, 2012 at 6:11 am
nothing meaningful if they don’t somehow get the ecb to fund it.
otherwise they are the next spain where talk of higher deficits sends your rates higher
Every time I speak with someone and challenge their assumptions that we’re going broke and it will ultimately drive our rates higher, they claim that it will happen when we no longer have the reserve currency. Hmmm…how do they explain Japan? Oh…most of their debt is held domestically. I wonder where those Japanese citizens got the money to hold it?
Warren – Here’s a segment I recorded last September when I was still at Reuters, but you get the credit as the talking points are vintage Mosler. http://reut.rs/qWH59r
I really don’t know much about bonds. Does this mean that tax advantages from swaps are drying up too? Yet another way of “decreasing the deficit”?
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Warren B. Mosler