22 Jan 2016

Stock Losses Take a Breather

Yesterday at lunch, when stocks were down more than three percent, I was reading market analysis and one analyst said that investors were disappointed by the ‘lack of policy response.’ That really struck me because markets were off sharply and it hadn’t occurred to me that the Federal Reserve hadn’t said anything material this year that might shore up stocks. Although we are steeped in losses very early in the… Read More

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15 Jan 2016

Insight: Fed’s Backing Down

Comments from central bankers have been dovish in recent days – they seem to be backing down from earlier statements that suggested that the fed funds rate could increase by one percent or more this year. St. Louis Federal Reserve President James Bullard noted that ‘with renewed declines in crude oil prices in recent weeks, the associated decline in market-based inflation expectations measures is becoming worrisome.’ He further said that… Read More

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11 Jan 2016

ALM Insights – January 2016

ALM Insights is focused on banks and other institutions that use their portfolio to manage risk on both sides of their balance sheet. It takes an in-depth look at securities investment strategies, balance sheet and asset/liability strategies, regulatory topics and general economic information. To view this issue, click the image below. In This Issue: We Have Liftoff! But I Thought Rates Went Up? Is The Canary Still Singing?  

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17 Dec 2015

The Fed Awakens

As expected the Federal Open Market Committee (FOMC) raised interest rates a quarter of one percent so that the target range for overnight lending is now 0.25-0.50 percent. Importantly, the Fed said that rates would rise gradually from here, actually using the word ‘gradual’ twice in the statement. Also, somewhat surprisingly, the vote to increase rates was unanimous.  I believed, and heard other commentators say, that there would likely be… Read More

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16 Dec 2015

Finally, Fed Day is Today

Well, today’s the day that we will in all likelihood get news that after seven years, interest rates will come off of the floor.  The Zero Interest Rate Policy (ZIRP) that the Fed has engaged in will finally be over. Although I have the feeling that what the Fed will do next will still dominate the conversation (when will they raise again, by how much, etc.), it will be nice… Read More

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9 Nov 2015

Jobs Report Gives Fed Ammunition

All markets were driven Friday by the Labor Department report which showed that US employers added jobs in October at the fasted past so far this year while wages rose at the fastest rate since 2009. Nonfarm payrolls rose by a seasonally adjusted rate of 271,000 last month and revisions for August and September added 12,000 more jobs than previously estimated, bringing the monthly average of 206,000. The newly created jobs… Read More

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29 Oct 2015

Fed Wake Up Call: December is on the Table

While the Fed kept interest rates at zero as expected, they did send two notable signals for investors to think about. First, they removed the language that first appeared in the last statement, which said that ‘recent global economic and financial developments may restrain economic activity somewhat and are likely to put further downward pressure on inflation in the near term.’ While they said that they will be monitoring global… Read More

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23 Sep 2015

ALM Insights – September 2015

ALM Insights is focused on banks and other institutions that use their portfolio to manage risk on both sides of their balance sheet. It takes an in-depth look at securities investment strategies, balance sheet and asset/liability strategies, regulatory topics and general economic information. To view this issue, click the image below. In This Issue: Janet Blinked What if You Called Them Market Perfectly? Part II Another Debt Crisis?

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18 Sep 2015

Now That’s What They Call Dovish

Well, we’ve got at least a few more months of the Fed’s ongoing ‘will they or won’t they’ drama about when they will raise short-term interest rates. Although markets did not expect a rate increase, it’s really impossible to know until the announcement because it really boils down to the judgment of the 12 Federal Open Market Committee (FOMC) members. You might think we don’t know anything more than we… Read More

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15 Sep 2015

A New Fed Plot Twist?

I thought I had heard every possible outcome of this week’s Fed meeting, but I heard an interesting new scenario yesterday from a bond specialist at the largest asset management firm in the world. Right now, we all say that interest rates are at zero and that the Fed is engaged in a ‘zero interest rate policy,’ or ZIRP.  That’s not quite true though, the fed funds target rate, as… Read More

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