shortonoil wrote:"Fortunately, the people that make the policy, have access to real time numbers, and the computational capacity to use those numbers."
Interesting that you would conclude that the CB's have a clue as to what they are doing? The CB's have taken $13 trillion out of their respective economies, and handed it over to the banks. In that respect I would totally agree that they knew exactly what they were doing.
pstarr wrote:So let me get this right, AgentR11: DEFLATION is headed off with zero-interest free-money for the super wealthy? Which impoverishes the elderly. But the same free-money should also be good for anyone else who borrows, right? The economy rebounds and peak oil becomes the myth it always was. No energy (no pollution) and economic growth. The best of all worlds.
Alfred Tennyson wrote:We are not now that strength which in old days
Moved earth and heaven, that which we are, we are;
One equal temper of heroic hearts,
Made weak by time and fate, but strong in will
To strive, to seek, to find, and not to yield.
"As I argued then back in the summer, God's plan is not for things to rise in the autumn. As a matter of fact that's why we call it fall. Nor is it God's plan for things to rise in the winter, through the snow. God's plan is that things rise in the spring. And so if you want to be good with the Almighty, you may want to delay until May."
http://www.bbc.com/news/business-35111816The World Bank warned in September that a US rate rise could increase the risks to emerging economies caused by disruptions to capital flows.
EdwinSm wrote:Just a few more hours, to the expected rise.
It troubles me that so many commentators seem to indicate a very small rise will create trouble all over the world. It could be that they are saying the world economy is very fragile - or it could be that they don't want to loss the profits they make from "free money"?
Example of warning:http://www.bbc.com/news/business-35111816The World Bank warned in September that a US rate rise could increase the risks to emerging economies caused by disruptions to capital flows.
Yet zero rates and QE set off torrid credit bubbles in the emerging world, pushing up the global debt ratio by 30pc of GDP beyond their previous record in 2008. The Bank for International Settlements calls this a “Pareto sub-optimal” for the world as a whole. The chickens have not yet come home to roost.
Mrs Yellen has no margin for error as she tries to right the ship and slowly restore the US economy to a “Wicksellian” natural rate of interest, without detonating the debt-bomb in the process.
If she fails, the world is in trouble. We have never been in a predicament where a global recession began with rates already near zero. The Fed typically needs 350 basis points of monetary ammunition to fight a downturn.
The only way out then would be "helicopter money", a potent use of QE to fund fiscal spending directly and inject stimulus straight into the veins of the economy. But that is a saga for another day. She has not failed yet.
Alfred Tennyson wrote:We are not now that strength which in old days
Moved earth and heaven, that which we are, we are;
One equal temper of heroic hearts,
Made weak by time and fate, but strong in will
To strive, to seek, to find, and not to yield.
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