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Posts Tagged ‘quantitative easing’

The Real Employment Situation in America

Posted by Larry Doyle on February 10th, 2014 6:39 AM |

The most recent employment report released this past Friday showed an increase in non-farm payrolls of only 113k jobs but a continued decline in the overall rate of unemployed to 6.6%.

While the growth in jobs is not what we would like, the overall rate of unemployment is not bad by historical measures, right?

To steal a phrase from the inimitable radio host Paul Harvey, “And now, the rest of the story.” (more…)

Goldman’s Call As to Future Federal Reserve Policy

Posted by Larry Doyle on November 7th, 2013 9:06 AM |

What might be the next move by the all powerful Federal Reserve as it goes about trying to nurse our economy back to health?

Mike O’ Rourke, chief market strategist at Jones Trading recently highlighted that the folks at Goldman Sachs believe Fed policy may be set to shift. I mean, who on Wall Street might have the ear of the Fed more than the folks at Goldman, right? Ok, ok, enough of the sarcasm.

Let’s navigate as O’ Rourke interprets Goldman’s reading of the Fed’s tarot cards regarding future monetary policy.  (more…)

Gartman: Investment Capital Will Leave US Market

Posted by Larry Doyle on October 18th, 2013 8:36 AM |

After the dysfunctional debacle displayed in Washington over the last few weeks — and potentially repeated in early 2014 — what is that strong symbolic wind now blowing offshore?

Oh, that is the sound of investment capital leaving our nation.

Not that those in Washington have a real appreciation for it but private investment capital is the lifeblood which fuels our economy.

While those in Washington are now sufficiently addicted to our central banking shell game, aka quantitative easing, why would they be concerned about protecting and promoting the formation of private investment capital? Great question.  (more…)

Sedating the Quantitative Easing Monster

Posted by Larry Doyle on September 19th, 2013 9:04 AM |

At what point does a patient become addicted to medication so that a subsequent malady is potentially as bad if not worse than the original condition the prescribing doctor was trying to treat?

How disturbing is it to learn of individuals strung out on pain medication or more specifically methadone to treat a debilitating condition or drug habit?

Very disturbing.

In a very similar fashion, our resident medic, that being Fed chair Ben Bernanke, found himself boxed in by our patient, supposedly our economy but really our markets, that had begun to convulse and palpitate when word that its QE medication was going to be lessened.     (more…)

Fed-speak: Ease Air Out of Bonds – Support Equities

Posted by Larry Doyle on May 20th, 2013 9:38 AM |

“Don’t fight the Fed.”

While the fundamentals of our underlying economy bump along with continued structural headwinds and fiscal support from Uncle Sam remaining anemic, the Federal Reserve’s QE-infinity remains the underlying cornerstone supporting our markets.

With equities making new highs and high yield bonds trading at stratospheric levels, recent pronouncements from Fed officials strike me as looking to accomplish two goals: (more…)

Ben Bernanke Pulls a Yogi Berra

Posted by Larry Doyle on May 2nd, 2013 8:04 AM |

When you come to a fork in the road . . . take it.

In the early years of the last decade, I had the pleasant experience of attending a dinner for a major client at which Yogi Berra was a guest speaker. As a lifelong baseball fan — and by the way,  how ’bout those Red Sox? — I looked forward to hearing Yogi regale us with legendary tales about the great Yankee teams.

He started his delivery by unequivocally stating, “I am not good at giving talks, so just go ahead and ask me some questions.” He entertained us with a slew of his famous non-sequiturs in fine fashion.

I thought of Yogi and that dinner when the Federal Reserve released its statement on the economy yesterday afternoon. (Do you notice a facial similarity between Ben and Yogi?) Having read Fed releases for the last thirty years, I am hard pressed to ever remember a statement as ambiguous as this  put out yesterday:

Making Sense of The Skyrocketing Cost of Gasoline

Posted by Larry Doyle on September 17th, 2012 7:33 AM |

I guess I could write this morning about the NYSE being fined by the SEC for facilitating front running. I could also offer more commentary on global banking institutions that now seem to realize a little thing called “reputation” actually matters. Perhaps I could offer insight on how the Fed’s recently announced “QE-infinity” is directed as a further bailout of the banks and the red-headed stepchildren commonly called Fannie and Freddie.

But let’s put those topics off for another time. Today, let’s address why your wallet is significantly lighter every time you go fill your vehicle’s tank.  (more…)

Will the Federal Reserve ‘Go Nuclear?’

Posted by Larry Doyle on June 8th, 2012 9:32 AM |

Many market participants are hoping and praying that Ben Bernanke will save the day by implementing another round of quantitative easing. Having become addicted to the monetary ‘heroin’ provided by our central bank, those on Wall Street would love another ‘hit.’

Is this the right approach to curing what ails our nation’s economy? Of course not. I stated as much in a recent interview:

“The problems with the current Fed policy and fiscal programs implemented by this administration are that the MASSIVE structural issues eroding the foundation of our economy and society are not being confronted.”

So what might the Fed do? With the Fed’s ‘dope’ packing less and less of a punch, would they ‘go nuclear’? What’s that you say?  (more…)

Quantitative Easing: To Infinity and Beyond?

Posted by Larry Doyle on January 29th, 2012 12:02 PM |

What does the Federal Reserve know that we don’t?

I mean, why would the Federal Reserve commit to keeping prevailing interest rates at next to zero through the end of 2014 if they were not aware of just how weak our underlying economy truly is?

Bernanke and team know our domestic economy and the global economy at large remain in need of significant and steady oxygen support. (more…)

What Caused the Market Meltdown?

Posted by Larry Doyle on August 4th, 2011 5:08 PM |

Everybody out of the pool” and “Adult Swim Only” are phrases that ring in my ear from my trading days at Bear Stearns. A long lost friend (God bless you, buddy!!) would bellow those statements when markets plunged like today.

What has recently drained the liquidity and lowered the water level in our equity market ‘pool’?

A number of critically important factors have been building and continue to haunt us.These include:

1. Meltdown in European sovereign debt. This is not and should not be a surprise. The meltdown was merely a matter of time. The outstanding question remains the depth and breadth of the meltdown. Stay tuned as risks remain very high.

2. The dysfunction in Washington truly displayed how screwed up our political dynamic is while shedding light on the enormity of our national debt and deficit. This reality is not changing anytime soon. Stay tuned as risks remain very high.


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