Treasury Archive

2008-09-16 JN Highlights

[Skip to the end] Highlights: Aug Consumer Sentiment Hits Record Low For 3rd Month Govt Panel To Call For Cutting Corporate Tax To 30% By FY15 Ota Reelected As New Komeito Leader For Another 2 Years Extra Budget To Total 1.81tn Yen, Govt Eyes 400bn Yen Bonds Lehman Failure Not To Mar ...Read More

Thoughts on the bailout of Freddie Mac and Fannie Mae

[Skip to the end] It comes down to public purpose. The agencies were set up to provide low cost funding for moderate income home buyers. They have done that reasonably well. However, for probably 20 years I’ve been saying the agencies should fund themselves directly with the Treasury or Fed financing bank ...Read More

Monetary ops

The larger point is that ANY assets banks are allowed to hold already have to be on the regulators approved list, and banks in any case can fund all their (legal) assets with with govt insured deposits. So why should another arm of government, the Fed, not always provide funding for the ...Read More

Proposal for mortgage ‘crisis’

As previously proposed a few years back: Fund agencies (fnma/freddy) through the US Fed Financing Bank that funds directly with Treasury at Treasury rates. This lowers costs for the agencies that gets passed through to borrowers and removes liquidity issues for agencies. Shareholders are still at risk of mortgage defaults; so, market ...Read More

Central bank debate: Is it inflation or deflation?

Here’s how the inflation can persist indefinitely: In addition to the India/China type story for resource demand, this time around nominal demand for commodities is also coming from our own pension funds who are shifting more of their financial assets to passive commodity strategies. Pension funds contributions have traditionally been invested primarily ...Read More

Why I expect US exports to continue to be very strong..

The desire to accumulate $US financial assets has been diminished for at least the following reasons: Treasury policy – Paulson is actively pushing both a strong yuan and threatening any other CB that buys $US with the label of ‘currency manipulator.’ CB’s had been perhaps the largest source of $US financial assets ...Read More

Strong $ AND strong yuan?

Reminds me of the guy who loves money and wants to abolish taxes. I do think the push is now for a stronger $, however, and we’ll see tomorrow if the Fed is on board. As a friend of mine pointed out, a firming $ will likely trigger domestic and international portfolio ...Read More