Wednesday the Federal Open Market Committee (FOMC) gave no date for an interest rate hike, leaving analysts and economists speculating as to when the long anticipated .25 percent increase in the federal funds rate, which now officially stands at “zero to .25 percent,” will come. Following the Fed’s official statements issued after FOMC meetings has
If there is anything that haunts the Fed chairpersons it’s the fear that they will be blamed for causing another Great Depression. Ben Bernanke, noted for his studies of the era, has said that the Fed did not do enough to prevent the calamitous 1930s depression. That position, undoubtedly, led to the Bernanke Fed implementing
Belatedly, Zimbabwe recently declared its currency, the Zimbabwe dollar, worthless. The marketplace recognized the worthlessness of the Z$ in 2009, when the Zimbabwe government adopted the US dollar as its main currency. Account holders with Z$ balances of zero to Z$175 quadrillion will be paid a flat US$5. A “quadrillion” has fifteen zeros.
One of the reasons gold and silver prices are stuck in a narrow trade range is that stocks are stuck in a narrow trading range. Still, widely-followed indexes recently made new highs, specifically the S&P 500, the NASDAQ and the Dow Industrials. However, the much ignored (except by professionals) Dow Transportation index is some 850
After not being significantly large enough to make headlines for years, the US trade deficit is back in the news after ballooning 40% to $51 billion in March. $37.8 billion of the deficit was with China. The CBO projects a record high $486 billion trade deficit for fiscal 2015.
While speculation is spreading that the Bank of Japan may increase its bond-buying program, with the dual goals of increasing economic activity and filliping the rate of inflation to 2 percent, influential members of the money establishment are asking “Is 2 percent inflation high enough?”
Around the world, central banks have joined in fighting a common enemy: lower prices. But, when did lower prices become the enemy?
Expectations of when the Fed will hike interest rates are driving the markets. However, no interest rate increase is likely to come from the Fed until at least June–if not farther out–according to Fed statements following the March FOMC meeting. This means that the federal funds rate will remain at the target of zero to
It is becoming even more clear that Establishment economists are now equating the rate of inflation to prosperity. Across the board, they are clamoring for the Fed to take action that will result at least 2 percent inflation.
Charles Plosser and Richard Fisher, presidents of the Philadelphia and Dallas Feds, respectively, announced plans to retire, leaving the Fed in the hands of inflation doves who seemingly have no fear of inflation.
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