Author Archive

Sweden hikes rates due to cost push inflation

This is the mainstream approach to negative supply shocks: “Don’t let relative value stories turn into inflation stories.” (as the Fed used to say) And, they say, if you wait for the economy to get strong bringing the higher rates of inflation down gets more than that much harder. STOCKHOLM, Sweden – ...Read More

Another Yellen speech

Prospects for the U.S. Economy in 2008 (intro remarks snipped) Today I’d like to talk about developments in the economy and in monetary policy, two items that have definitely been making the news lately. On January 22, the Federal Open Market Committee cut its main policy rate—the federal funds rate—by three-quarters of ...Read More

Government spending may be accelerating

US Jan budget surplus narrows as spending hits record by David Lawder WASHINGTON, Feb 12 (Reuters) – The U.S. government posted a $17.84 billion budget surplus for January, less than half the year-earlier surplus, as spending hit a record for the month while receipts fell from a year ago, the U.S. Treasury ...Read More

Oil AND interest rates up?

It’s only been a few hours, but seems the first time since August higher oil doesn’t mean lower interest rates, and might even mean higher rates. Up until now, higher oil prices meant a weaker economy and therefore Fed rate cuts. I’ve been watching for a shift to higher oil prices meaning ...Read More

Stagflation

Yes, the below analysis has also been the Fed’s position, up until this week’s speeches. It’s been about a crude/food/$ negative supply shock, supported by Saudis/Russians acting as swing producer and biofuels linking crude prices to food prices. The fed has called the price hikes relative value stories that they don’t want ...Read More

5yr tips 5 years fwd

The Fed’s pet inflation expectation indicator is moving higher, fast. ♥ ...Read More

Yellen on inflation

SF Fed president Yellen on inflation, from yesterday’s speech in Hawaii: Now let me turn to inflation. The recent news has been disappointing. Over the past three months, the personal consumption expenditures price index excluding food and energy, or the core PCE price index—one of the key measures included in the FOMC’s ...Read More

Re: 1st step for ECB

(an interoffice email) I’m thinking they had to do something about the euro. the eurozone exporters can be very convincing warren On Feb 7, 2008 10:41 AM, Karim wrote: > > > > Is taking hikes off the table, so: > > 1) No mention of acting ‘pre-emptively’ > > 2) No ...Read More

2008-02-07 US Economic Releases

Initial Jobless Claims (Feb 2) Survey 342K Actual 356K Prior 375K Revised 378K Moving down, but will need to fall more next week to signal employment is doing reasonably well. Continuing Claims (Jan 26) Survey 2715K Actual 2785K Prior 2716K Revised -2710K Back up a bit, but not through the highs, and ...Read More

U.S. Job-Market Weakening Is Led by Self-Employed

Keeps getting stranger by the day. Next thing they’ll be saying is GDP really fell in Q3 and Q4, but the drop was all in off the books transactions. By the way CNBC actually put positive, overstated spin in the headlines on a couple of things. They said mortgage applications were the ...Read More