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US FED: FRB NY's Dudley Dismisses Inflation Fears
Dudley acknowledged that there are some risks inherent in the Fed's strategy, including that it could unhinge inflation expectations, but he said the Fed is monitoring these risks and sees no danger signs yet.
Here's a chart of what the Fed sees.
Note that I used an exponential trend line starting from the point the price of oil bottomed late last year, that the trend line is curving upwards, and that today's price of oil got a nice boost over the weekend (not seen in the chart, bringing it nearly all the way back to the trend line).
August 3, 2009
Economic oil spill on the horizon?
Hembre said that it seems that oil prices are rising more as a result of investors being willing to take on more risk as opposed to actual changes in fundamentals.
Well, why wouldn't investors take on more risk? The Fed hasn't spotted any danger signs yet. Hahaha!
October 27, 2005
Bernanke: There's No Housing Bubble to Go Bust
Fed Nominee Has Said 'Cooling' Won't Hurt
For what it is worth, I'd be one nervous oil trader right now if I was long. We know what happens when the Fed finally sees danger signs. Those trying to milk every last penny out of a parabolic rise tend to panic right along with them. D'oh!
May 22, 2009
Bernanke: Crisis has 'dominated my waking hours'
WASHINGTON — Federal Reserve Chairman Ben Bernanke Friday said that battling the worst financial crisis to hit the United States since the 1930s has "dominated my waking hours" for the last 21 months.
July 15, 2008
Scared yet? Sure, but don't panic
The temptation is to panic. But that is the worst possible thing to do as it is just fueling more selling and a sense of impending doom. Just look at what's happened with the banking sector.
The DJIA closed that day at 10,962.54. Sorry about that! I've been fueling the sense of impending doom here since August of 2007! ;)
See Also:
Trend Line Disclaimer
Source Data:
EIA: Cushing, OK WTI Spot Price FOB (Dollars per Barrel)
7 comments:
Stag,
In my view, the markets reek of excess liquidity. And the excess liquidity appears to be counter-productive - again!
There's a good chance that hedging will kill Bernanke's attempts at reflation. Current feedback loop/vicious circle: the fed is reflating, peak oil, dollar depreciation worries = higher oil prices = slower growth = more reflation shenanigans = more inflation hedging = slower growth = more reflation tomfoolery = .....
Bernanke should have let the market crush the wall st speculation model when he had the chance. Wall St. should be suffering along side Main St.
When I read about the huge forth coming huge Wall St. bonuses I really feel like behaving badly.
Mark,
great compilation! i always love to see quotes from the players froma while back, too funny.
Mab,
I have an idea where all that liquidity is going to go, "Cash for BLANK" programs!
mab,
"Current feedback loop/vicious circle..."
The machine has few control knobs but the Fed has one heck of a hammer. Let's hope they are adept at unwhacking the machine as they are at pounding away at it.
GYSC,
"Cash for BLANK" programs!
You say BLANK, I say BANK!
You say CLUNKERS, I say BUNKERS!
Pay-as-go, Pay-Hasbro, Toyota, Toy-Quotas
Let's write the whole thing off!
Sorry, broke into song again! ;)
Stag,
From today's BEA release.
Personal income excluding current transfer receipts (income from the gov't), billions of chained (2005) dollars:
Q2, 2007 - $9.636 trillion
Q2, 2009 - $9.057 trillion (6% decline!) A soylent green shoot!
Per capita basis:
Q2, 2007 - $32.0k
Q2, 2009 - $29.5k (7.8% decline!) Another soylent green shoot!
And don't forget, the median would be really, really ugly. Oh well, at least Bernanke was able to CONtain the damage to Main St. No sense having Wall St. suffer along side Main St.
Stag,
More green shoots from today's BEA release:
Private wage & salary disbursements:
Q2, 2007 - $5.288 trillion
Q2, 2008 - $5.402 trillion
Q2, 2009 - $5.073 trillion
Government wage and salary disbursements
Q2, 2007 - $1.084 trillion
Q2, 2008 - $1.136 trillion
Q2, 2009 - $1.184 trillion
If this trend CONtinues, we won't have private wages in the future! The leeches of big government and finance capital are CONsuming the host.
Stag,
Those are UGLY trends!
UGLY indeed. It really makes me wonder how all the excessive household debt will be serviced.
I really don't see how the markets can ignore all that debt in the system. It seems reasonable to conclude that wages aren't going to fully service the debt. And there is no way the debts can be serviced anymore through asset appreciation and borrowing....... unless...the fed......never mind.
mab,
"....... unless...the fed......never mind."
........ is abolished?
........ drops cash from helicopters?
It must be the former because they are already doing the latter, lol. ;)
Why couldn't you say it? Why are the helicopters black? Why are there men in black at my front door! Why..... *gun shots* .....
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