Bernanke Archive

Mar 15 update

The question for the Fed: Will further rate cuts help or hurt the credit crisis? The Fed has been cutting to support the financial sector, and address risks (as they see them) of financial sector issues spilling over to the real sector. How does the Fed see rate cuts helping the financial ...Read More

Comments on 8:30 numbers

Retail sales weak today, but exports up over 16% earlier this week, and jobless claims now settling in around 350,000 – far from recession levels. That’s what export economies look like. Meanwhile, non oil import prices up 0.6%, and export prices up 0.9%. US GDP growth may be hovering around zero, but ...Read More

MSNBC: dollar exit supports GDP

This is all part of the effort of non-residents to no longer accumulate $70 billion per month of US financial assets. The USD goes down as they try to sell USD to each other at lower and lower prices and doesn’t stop until levels are reached where it makes sense to spend ...Read More

Bloomberg: from Fisher the hawk

While Fisher is perhaps the most hawkish voting member and voted against Bernanke at the last meeting, continuously rising crude/food prices and a not so large output gap are causing more voting members to firm their anti-inflation rhetoric in recent weeks: Fisher Says Credit Markets May Not Force Fed to Act by ...Read More

Bernanke and the beast: beware the MNOG!

4:20 pm Eastern time, March 6 TIPS 5y5y fwd Twin themes remain since Q2 2006: weakness and inflation. Weakness: The great repricing of risk continues driving credit spreads wider, bid/offer spreads wider, volumes lower, and market forces continue to drive a general, massive deleveraging in the financial sector. Housing is very weak: ...Read More Dallas Fed President: Inflation, not recession, is No. 1 woe – Mar. 4, 2008

Yes, Fisher is on record as the lead inflation hawk. If he’s right and it turns out Bernanke cut rates into a 70’s style inflation Fisher has to be a leading candidate for Fed Chairman. Much like when Volcker replace Miller in 1979. And Kohn gets passed over a second time, this ...Read More

Bernanke House Committee Transcript

From the first day: (EDITED) BERNANKE: Well, mortgage rates are down some from before this whole thing began. But we have a problem, which is that the spreads between, say, treasury rates and lending rates are widening, and our policy is essentially, in some cases, just offsetting the widening of the spreads, ...Read More

Here’s how Congress sees it…

Congress sees their voters facing prices that are rising faster than incomes due to Fed rate cuts driving the $ down. Bernanke testifies that price hikes for food and energy are not a problem for the Fed until wages go up. So, he’s going to keep cutting rates and driving the cost ...Read More

Re: Bernanke/data

(an interoffice email) Yes, and he reaffirmed that he’s using the futures prices to predict where prices are going.  He pointed to crude being at $95 in the back months and stated that translates to a forecast for prices to come down from current levels. Also indicated the lower dollar is useful ...Read More

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