money

The U.S. Dollar got more bad news today when the Bank of England (BoE) decided to not follow the U.S. Federal Reserve's lead to a Zero Interest Rate Policy (ZIRP). The BoE was seen as the most likely to follow in the Fed's footsteps as i…

I recently wrote a post about U.S. Treasury securities which have been rising in price as interest rates have come down. In the post, I called the Treasury rise a bubble and I stick by that moniker despite protests from some astute readers.…

To my mind, lowering interest rates in the aftermath of an enormous credit bubble where institutions have just destroyed $1 trillion in capital is wrong. It distorts lending decisions such that yet more money will eventually be lent out…

The yield on all U.S. Treasurys securities are at historic lows. The 3-year T-bill and the 1-year T-bill have both actually sported negative yields -- meaning investors are paying the U.S. Governemnt to borrow money from them. This is the…

Russia is one country that we do not want to see fall on hard times. It has great geo-strategic power, but a weak economy, declining oil output and revenues and increasingly autocratic rule? Now it is being roiled by the global financial…

Caroline Baum had a good column today at Bloomberg in which she suggests central banks consider asset prices in monetary policy going forward. In the piece she quoted William White, a former economist from the Bank for International…

The yield on he three-month U.S. treasury bill went below zero for the first time ever. This seems to be an unprecedented move where investors are actually paying the U.S. Government to borrow money. In my estimation, this is not just a…

First the Fed and now the ECB and Bank of England are talking about some form of quantitative easing! Of course, if they are all going to do it, do we have a dollar crash or is it more of a crisis of confidence in fiat currencies in…

Quite a punchy speech from the Fed Chairman, especially the conclusion, which suggests big support ahead for housing: In this regard, reducing the number of preventable foreclosures would not only help families stay in their homes, it…

One feature that is peculiar to the present downturn is the accumulation of reserves at the U.S. Federal Reserve. I imagine it is no different at other central banks, though I have not seen the data. Let me tell you what this reserve…