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Thanks, Obama! ( you know that's coming from the Repugs )
http://www.bloomberg.com/news/2015-0...iss-shock.htmlThe U.S. Commodity Futures Trading Commission allows investors to put down as little as 2 percent of the value of their foreign-exchange bets. Brokers may get stuck with the balance of losses suffered by clients who used leverage, borrowed on credit cards, or did both to bet against the franc.
sameThe market turmoil turned the $1.9 billion John Han Absolute Return Currency Fund into the biggest loser among U.S. peers. It tumbled 8.7 percent yesterday, the steepest drop on record and the most among more than 2,000 U.S.-domiciled funds tracked by Bloomberg with at least $1 billion under management.
Thanks, Obama! ( you know that's coming from the Repugs )
coincidentally:
http://www.reuters.com/article/2015/...0KP1H620150116U.S. consumer prices recorded their biggest drop in six years in December and a gauge of underlying inflation was flat, which could make the Federal Reserve more cautious about raising interest rates.
The Labor Department said its Consumer Price Index fell 0.4 percent last month, the largest decline since December 2008, after sliding 0.3 percent in November.
In the 12 months through December, the CPI increased just 0.8 percent, the weakest reading since October 2009 and a sharp deceleration from November's 1.3 percent rise.
"The odds of a rate hike in June are fading fast," said Mic e Girard, chief economist at RBS in Stamford, Connecticut. "The recent data cannot leave the Fed feeling more confident that inflation will move higher."
While Fed officials have viewed the energy-driven drop in inflation as transitory, a strong dollar is taming underlying price pressures, which could cause them some discomfort.
The so-called core CPI, which strips out food and energy costs, was unchanged in December. It was only the second time since 2010 that it did not increase.
so much for QE causing hyperinflation
One thing I think it's helping the US economy is the lower gas prices. It seems a simple, innocuous thing, but it's probably one of the best ways to put money on the pockets of people of almost all classes.
should be broadly beneficial outside the energy sector.
That was just another FUD LIE in the nothing-but-LIES coming from Repugs.
ARRA was also supposed to be a huge stimulus of hyper-inflation, Social Security MUST be privatized before it fails, trickle down is all the USA needs, cut taxes on the "job creators", etc, etc.
http://www.washingtonpost.com/blogs/...rically-crazy/But was this a good idea? Well, probably not. Switzerland is still stuck in deflation, with prices falling 0.3 percent, and a stronger currency is only going to make that worse. Now, they tried to offset this by charging people even more to hold their money in Switzerland—aka negative interest rates—but that wasn't nearly enough to stop the Swiss franc from going vertical. The SNB, in other words, chose a slower economy today, because it was afraid of a bigger balance sheet tomorrow, maybe a much bigger one if the ECB buys more bonds than expected. Their thinking seems to be that the Swiss franc was inevitably going to get stronger, which will inevitably mean taking paper losses on their euro assets, so why rack up even bigger losses for what might only be a minimal gain?
If they're wrong, though, Switzerland's currency might not be the only thing that goes bang. Its economy might too—and not in a good way.
gas money retained in shoppers pockets didn't keep Christmas sales from being below last year's
the 99% are still hurting badly, underemployed, employed at ty wages, and future looking grim for themselves and their kids.
More than Half of US Public School Students Live in Poverty, Report Finds
http://www.alternet.org/education/more-half-us-public-school-students-live-poverty-report-finds
Even funnier were the s who were shorting on margin... ROFL...
http://www.reuters.com/article/2015/...0UU1OE20150115
Hedge funds, speculators face big losses on Swiss franc rally
Jan 15 (Reuters) - Currency speculators, particularly large global macro hedge funds with big short positions in the Swiss franc, are staring massive losses in the face after the Swiss National Bank shocked markets on Thursday by removing a three-year-old cap on the currency.
The move sent the safe-haven franc soaring against the euro and the U.S. dollar at a time when more than $3.5 billion was positioned in favor of franc weakness, the largest such position in more than a year and a half.
Only days ago, the SNB termed the 1.20 francs per euro cap the cornerstone of its monetary policy.
The damage from the Swiss franc's sharp moves comes as a blow for macro hedge fund managers nursing wounds from nearly four years of mediocre performance.
The Swiss Bank Should Burn in a Special
Thu Jan 15, 2015 7:17am
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So I went to sleep around 4:10am to Dow futures up 150. I woke up at 6:10am to them down more than 110. The news is, as you already know, the Swiss bank removed the “Swiss ceiling” and “Euro floor”, paving the way for an incredible one day +15%+ move in CHF vs Euro. As a result of this, the Swiss market is down more than 12%, the largest decline since 1989.
Everyone wants in on the Swiss Franc and people are selling euros every which way but loose. This is NOT a ing reason to sell stocks. You’d have to possess the thinking capacity of a horse to view this as a negative for stocks. Who gives a , really? The Swiss bank couldn’t keep up the charade any longer, with their artificial pegging to the euro.
Why?
Because the ECB is going to announce and begin massive QE next week. If they permitted this peg to stand, they’d need to bag hold euros on an epic scale. So, they figured now was the time to end the stupidity and the market is responding in kind.
I view this market response with the same demeanor as a serial killer would view his next target. I have nothing but unadulterated disdain for all parties involved. I want them to perish in fires, crushed under elevators, dropped down manholes. This dip will be bought, or NOT! It’s not like the +150 market open was gonna stick anyway, right?
We are living in very interesting times. America shall thrive off this news and punch our european counterparts in the ing face, many times over.
An excellent read:
http://www.telegraph.co.uk/finance/e...f-control.html
unregulated, criminal finance and unregulated, crimianl banks, thanks!
Boo doesn't know the difference between banks and central banks?
Thanks for sharing. There really are no guarantees that QE will work for them, but they just can sit idly while deflation keeps ravaging their economies. Just a tough situation.
I'm mostly ignorant of the finer aspects of these financial moves. Can anyone explain to me the likely scenarios that will arise once the U.S. and UK attempt to undo all of the QE they've done. It's gotta come back out right?
Seems to me like we've treated the symptoms of a bad market rather than the underlying conditions no?
The idea is to buy vast amounts of depreciated (due to recession/deflation and the economic outlook) assets (in this case bonds) in order to inject liquidity in the market, in hope this newlyfound liquidity finds it ways into economic growth. With interest rates near zero, there's little incentive to save that kind of money. Once the economy expands and is back into growth, such assets bought should appreciate, and can be resold for a profit.
That's the theory of it anyways. It's basically temporarily growing the monetary base to spend in very specific assets that can be redeemed in the future, as opposed to just spending at will.
Technically QE wouldn't have to be unwound if the underlying economies could grow fast enough to absorb the surplus. Unfortunately they haven't.
U.S. QE is pretty much over. The unwinding will be the slow work-off of the massive FED balance sheet. They bought a LOT of bonds with created money, and will likely not replace those bonds as they mature, or even slowly, discretely sell them.
We have changed some things (tightening mortgage underwriting standards), but the underlying faults that caused the financial crisis have not, by and large, been solved. Too Big To Fail still should worry/anger anyone.
On the other hand... they are now earning interest on four ing trillion dollars. That is a lot of money that will be forked over to Congress, as all Fed profits are.
http://en.wikipedia.org/wiki/Federal_Reserve_SystemThe U.S. Government receives all of the system's annual profits, after a statutory dividend of 6% on member banks' capital investment is paid, and an account surplus is maintained. In 2010, the Federal Reserve made a profit of $82 billion and transferred $79 billion to the U.S. Treasury.[22]
I find it hard to say four trillion dollars without going all tourettes. That is just an insane pile of money.
mea culpa.
Don't be so sure about QE being over. The are rewriting US growth projections as we type. Some pretty terrible earnings reports from some blue chip bellweathers today. if the economy stalls again they will be right back trying to pump it up again.
Repugs will help stall the economy with austerity at all levels then blame it all on the dems in 2016 campaign
so much for having a spittle free converstaion.
Cosmic Dime Store Cowboy can't handle the truth.
We saw the Repugs do EVERYTHING the could running up to 2010 and 2012 elections to keep the economy down, sputtering. All their govt budget cutting at all levels will continue. They absolutely don't want Dems running on a booming economy in 2016.
The condition of the economy IS defined by political decisions. I spit in your coffee
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