BofA’s Ajay Kapur is "delighted", thanks for asking. Specifically, he's "delighted that the consensus opinion has shifted our way", where that means the world has finally come around to the reality that rate hikes and quantitative tightening simply aren't tenable in the current environment. Back in December, Kapur penned an urgent message, imploring central banks to “please reflate”. Suffice to say it didn't take long for policymakers to come around. Starting with Jerome Powell's Janua
4 thoughts on “‘Simultaneous Combustion’.”
I think one of the problem is that there have been incomplete attempts in both easing and tightening in the past few years… Whether this is a comment about the politics or the state of world economies is perhaps the real question. The use of Sanctions especially by this administration does not bode well for anything except a high level of acrimony among major trading blocks.
Meaning to say here that if you insert a graph of the Fed funds rate over the asset sensitivity Chart displayed above it becomes apparent almost no variation in rates produces a huge equity swing … Could be a lot of factors contributing to that phenomenon but it certainly magnifies any level of manipulation to a high degree.
if memory serves….last time the fed started lowering it couldnt get infront of the mkt..chased it down lower and lower
The Feds original mandate was to control inflation. Unemployment was later added to this. There is nothing about global economies and nothing about supporting equity markets.
The Federal Reserves tightening policy has been acconpnyied by Large tax cuts oriented towards corporations and to a lesser degree towards individuals.This has not been the case in either Japan or Europe.
Lower rates will benefit those with assets and will help very little those without assets. Lower rates will exacerbate the super stupid policy of stock buybacks and flippping houses while causing the middle class to shrink even further