Low Interest Rates Don’t Drive Up Asset Prices – Governments Do
Yet our modern monetary mandarins never stop to consider Bagehot’s warnings about the adverse consequences of easy money – how interest rates set at 2 per cent or less fuel speculative manias, drive savers to make risky investments, encourage bad lending and weaken the financial system. One wonders whether any of them has actually opened the pages
... See moreEdward Chancellor • The Price of Time: The Real Story of Interest
Today, interest rates are exceptionally low and the growth outlook for advanced economies is modest at best. This leads us to conclude that the question is when markets will start putting pressure on governments, not if.
Jonathan Tepper • Endgame: The End of the Debt SuperCycle and How It Changes Everything
With interest rates low and set to remain so, and banks prepared to prop up weak businesses for fear of crystallising losses, monetary policy looks very unlikely to precipitate a major reallocation of resources.
Edward Chancellor • Capital Returns
Notably, Stephen Miran and Nouriel Roubini recently published a paper about “Activist Treasury Issuance” which is their term that refers to the Treasury Department taking unusual actions to offset the Fed’s tightness. Both Miran and Roubini are economics PhDs and worked in various capacities with the Treasury Department in the past.
In the paper, th
... See moreLyn Alden • Potential Asset Rotations: Deep Dive Analysis
But now, amidst market turmoil and a public health crisis which much of the world – in particular the US – is fully unequipped to handle, it’s a flaming question mark whether any real growth occurred during this period, or if the high times were merely a fantasy created mainly by capital injections (or “money printing”) from central banks in the US... See more