asterisk2a + easing   12

Ben Bernanke realised printing yet more money would look desperate - Telegraph
The reality is QE has already done an awful lot of damage. America has expanded its base money supply three-fold in two and a half years – from 6pc to 18pc of national income. But even this jaw-dropping measure hasn't led to much of an expansion in monetary measures, such as M2 that include bank lending, precisely because the banks, for all the propaganda to the contrary, are still determined not to lend. They can make more money simply channelling QE money into stocks and other investments.Crucially, the banks also remain petrified of counter-party risk in the inter-bank market. Many of them, disgracefully, are still concealing vast sub-prime losses in off-balance-sheet vehicles. So they assume other banks are doing the same. Such mistrust between the banks – "we're lying, so they must be lying" – gums up the wheels of finance and starves even creditworthy firms of the funds needed to invest and create jobs.

zombi banks - same as japan +10 years ago.
transparency  Fed  benbernanke  2011  JacksonHole  QE  QE3  QE2  quantitative  easing  ZIRP  M2  moneysupply  monetary  policy  inflation  deflation  USA  UK  monetarybase  interbank  LIBOR  trust  confidence  toxicassets  subprime  zombi  banks  company  capitalism  fiatmoney  politics  barackobama  presidency  GeorgeOsborne  davidcameron  greatrecession  recovery  lostdecade  Japan  balancesheet  recession  richardkoo  deleveraging  debtoverhang  sovereign  debt  crisis  centralbanks  trichet 
august 2011 by asterisk2a
BofA Warns Upcoming "Desperate Measures" By Authorities Will Result In Another 2008 Market Collapse | ZeroHedge
 "rather than a repeat of 2010, when the Fed saved the day with QE2, we think we are moving closer to a repeat of 2008, when major policy errors devastated the economy." For once we actually agree with Bank of America: "In our view, the pressure to “do something” is now far more likely to result in more desperate or radical measures, even if it is bad policy." Does this mean that we are looking at a TARP "vote down" market reaction this Friday if indeed the chairman disappoints? We will know for sure in about 100 hours, which just may be the longest 100 hours for bulls since the start of the artificial and solely QE inspired bear market levitation in March of 2009. 
The environment has become too overwhelmed by uncertainty, particularly on the policy front. In our view, the pressure to “do something” is now far more likely to result in more desperate or radical measures, even if it is bad policy.
QE2  QE3  August  JacksonHole  Fed  benbernanke  2011  market  expectations  monetary  politics  error  mistake  uncertainty  ZIRP  easing  quantitative  quantitative-easing 
august 2011 by asterisk2a
Is QE3 already taking shape? |
Seems to us that this all may be about the Fed opening the back door for QE3, a.k.a. Operation Twist: securing that there is some reasonable yield at the short end of the curve by offering an endless supply of short-date treasuries, thus preventing the disorder and “haircuts” from borderline or outright negative yields for those looking to park money in a safe place. The other leg of O.T. – long rate interest rate targeting (most likely sans actual buying intention announcements), has yet to see the light of day – but then again, we have the Jackson Hole, Wyoming conference coming up in two weeks…
Definitely something to chew on over the weekend.

So the Fed’s decision to start reverse repo specifically to money market funds is specifically about giving them somewhere to invest their cash at a positive interest rate.
QE3  Fed  monetary  policy  quantitative  easing  quantitative-easing  QE  ZIRP 
august 2011 by asterisk2a
Monetary policy: Was the Fed timid, or bold? | The Economist
The Committee currently anticipates that economic conditions--including low rates of resource utilization and a subdued outlook for inflation over the medium run--are likely to warrant exceptionally low levels for the federal funds rate at least through mid-2013.Now you tell me: what inflation rate does the Fed want? What rate is it prepared to tolerate? Maybe—hopefully—the Fed's action was actually an aggressive move to counter economic weakness. The fact that we're all still able to debate the matter leaves me sceptical that it was.
monetary  policy  Fed  2011  ZIRP  language  statement  FOMC  minutes  August  greatrecession  recovery  economy  QE  easing  quantitative  quantitative-easing 
august 2011 by asterisk2a
Switzerland pays price for fiscal sanity - Yahoo! Finance
The appeals followed a failed SNB attempt Wednesday to deter investors by lowering the country's already feeble interest rate target to near zero and opening the taps for commercial banks to increase their overdrafts -- effectively printing free money in a bid to make the franc less attractive.

"Obviously, this measure was not sufficient," said Tobias Straumann, who teaches financial history at the University of Zurich.
About 10 percent of Switzerland's work force depends directly on exports, whose value in francs is sinking in line with the dollar and euro. These include the watchmakers, chemical manufacturers and engineering companies that form the bedrock of Swiss industry. Employers have already laid off some workers, imposed longer working hours on others and even suggested paying salaries in euros -- a proposal unions strongly rejected.

Hildebrand @Wednesdays measures (ZIRP & QE):: "aren't meant to be symbolic, but a signal."
SNB  monetary  policy  2011  QE  quantitative  easing  ZIRP 
august 2011 by asterisk2a
Currency Intervention Revived as Fed May Ease - Bloomberg
Just eight months ago, Brazilian Finance Minister Guido Mantega declared a “truce” in competitive currency devaluations. Now, Japanese and Swiss moves to weaken the yen and the franc show reviving tension in foreign-exchange markets as the deteriorating U.S. economy weighs on the dollar.
Fed  QE3  unintended  consequences  global  stability  Dollar  reserve  currency  hot-money  ZIRP  growth  greatrecession  recovery  2011  monetary  policy  easing  QE  BOJ  SNB  RBA  RBNZ  BOE  ECB  benbernanke  quantitative  intervention 
august 2011 by asterisk2a
How the world paid the hidden cost of America's quantitative easing | Business | The Guardian
local policy is leaking in a global economy. not deniable.

investor cash looking for a high return.The chase for yield – the need to hold assets with a low value relative to the return – is nothing new. However, the billions of pounds spent by central banks on their own government's bonds released a tidal wave of cash that needed to find a home. Booming commodity markets were an unwanted side-effect of boosting investor confidence in stock and bond markets, which had threatened to spiral downwards when the recession hit.

Adam Posen, an external member of the Bank of England's monetary policy committee, repeated his warning earlier in the week that Britain needed another dose of QE to keep asset prices from sliding and stop confidence in the economy ebbing away. In the face of government austerity cuts, which will strip more than £12bn out of the economy this year in rising VAT bills alone, he said an extra £50bn in QE was the bare minimum needed.
QE  QE-2.0  quantitative  easing  2011  commodities  benbernanke  Fed  UK  BoE  judgement  outlook  review  monetary  policy 
july 2011 by asterisk2a
Bank of England called on to increase QE - Telegraph
The Bank's Monetary Policy Committee, which is meeting this week, will be pushed by economists to raise the amount of bonds and gilts it plans to buy by a further £50bn, following the recent news that unlike almost any other major economy Britain remains mired in recession. The increase would mean the Bank would soon be holding bonds worth more than 15pc of Britain's entire economy in its balance sheet unknown territory for any developed world central bank in modern history.
BoE  QE  quantitative  quantitative-easing  easing  2009 
november 2009 by asterisk2a
The Bank of England thinks the credit crunch is far from over - Telegraph Blogs
BoE increases QE a notch. 175bn£
- gilts / bonds from gov and pound takes a nose dive.
- and M4 broad money is still stagnant, no inflation.
“The future evolution of output and inflation will be determined by the balance of two sets of forces. On the one hand, there is a considerable stimulus still working through from the easing in monetary and fiscal policy and the past depreciation of sterling. On the other hand, the need for banks to continue repairing their balance sheets is likely to restrict the availability of credit, and past falls in asset prices and high levels of debt may weigh on spending. While some recovery in output growth is in prospect, the margin of spare capacity in the economy is likely to continue to grow for some while yet, bearing down on inflation in the medium term. But the recession and the restricted availability of credit are also likely to impact adversely on the supply capacity of the economy, moderating the increase in economic slack.”
QE  quantitative-easing  quantitative  easing  BOE  2009  deflation 
august 2009 by asterisk2a

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