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November 11, 2010
Fed plan nudges Treasury rates lower
The Fed announced a $600 billion bond-buying package last week that is aimed at lowering interest rates and encouraging spending.
November 16, 2010
Rising Yields Help Fed Raise Inflation Expectations With QE2
“Ten-year Treasury yields will begin to pick up slightly now, and be in a continuous higher trend,” said Fabrizio Fiorini, head of fixed income at Aletti Gestielle SGR SpA in Milan, who manages about $8 billion in assets. “You have to discount that the Fed will be successful, so you should be selling Treasuries.”
Allow me to summarize the thinking here.
QE2 is driving interest rates down. This will encourage spending. This is the Fed's plan.
QE2 is driving interest rates up. This will raise inflation expectations. This is the Fed's plan.
In other words, no matter what happens to interest rates we'll be able to point to the Fed's plan as a success.
Genius! And to think that I once thought the Fed was rather impotent. God how I love the hard science of economics to prove me wrong.
Real Estate Newsletter Articles this Week: Existing-Home Sales Increased to
4.15 million SAAR in November
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At the Calculated Risk Real Estate Newsletter this week:
[image: Existing Home Sales]*Click on graph for larger image.*
• NAR: Existing-Home Sales Increase...
10 hours ago
9 comments:
Stag,
Oh yes, the hard(ly) science of eCONomics. I've "herd" it's based on there being safety in numbers
Worst investing disasters of all time
But this is nothing new. History is rife with examples of speculative exuberance followed by gut-wrenching losses.
There's no mention of the gold/silver/commodity bubble in the 1970s. That era was conveniently ignored.
One would think that buying silver at $50 in 1980 and selling it 20 years later for $5 would qualify.
That is a 90% loss over a 20 year period (and that's not even adjusting for 20 years of inflation).
That's far worse than stock investors did buying at the peak in 1929 and holding for 20 years.
Angry Saver (mab),
I've "herd" it's based on there being safety in numbers
The key is in continually checking one's "junk" for any signs of a bubble. You don't want things getting all bunched up on a man, lol. Sigh.
The last thing we need is a Melvin economy where even "junk" isn't safe.
And let's not forget the underpants gnomes.
1. Collect "junk" protection.
2. ????
3. Profit!
Sorry. I must still have TSA on the brain.
http://finance.yahoo.com/news/Sears-Holdings-loss-widens-in-apf-146985334.html?x=0&sec=topStories&pos=main&asset=&ccode=
Sears is acting like gold money from 1980 to 2000.
mab,
From your link...
Sozzi says he sees Sears' move to open on Thanksgiving Day as a "desperate" attempt to draw in shoppers.
That's exactly what I told my girlfriend when I saw their ad.
It reminds me of the first grocery store chain to stay open 24 hours. Is the industry as a whole selling more food now?
If it works for Sears then it will most likely only work once. Next year everyone would be forced to do it. The advantage will be gone. In its place will be higher costs (keeping a store open on a holiday isn't free). Those higher costs will give the online retailers a bonus advantage.
If it doesn't work for Sears, that would be even worse of course.
Who would shop for Christmas gifts on Thanksgiving Day without expecting huge discounts as compensation? What's next? Buying 4th of July fireworks on Christmas Day?
Speaking of genius:
http://www.ken-fisher-debunkery.com/
No matter what happens, stocks are a buy.
mab,
Here's another link that summarizes it apparently.
10 Market Myths That Just Got Debunked
5. You should expect average returns
What a myth that one is! The average person should not expect average returns. No doubt about it. *sarcasm*
Using Madoff as an example...
It's a nearly perfect example I might add.
...and finds that investors saw big returns 38.1% percent of the time, average returns 33.3% of the time and negative returns 28.6% of the time.
That's some of the craziest rear view mirror myth debunking reasoning ever.
As a side note, I thought we might close above 1200 on the S&P so that I could comment on it today. No such luck. The Rubikahn taunts me.
Chekov: You lie! On Ceti Alpha Five there was life! A fair chance...
Khan: THIS IS CETI ALPHA FIVE!
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