Why June 5? The correlation between yields and gold already makes sense given gold is often defined by the opportunity costs for holding other similar kinds of safety hedges (like bonds). Not in printing legitimate and useful money, which he can’t, in lieu making you think that’s what he’s doing, what he will do and do forever. There was no fedspeak here, the Greenspan-perfected art of using a lot of words to say practically nothing. Since, the prior frenzied buying has been replaced by nearly two months of worried angst; enacting a sort of ceiling on the stock index. Like November 2010, going by the textbook, it should have already. Except, no, gold has been on its upward trajectory since early October 2018, not mid-March 2020 when that “flood” got started. For while in November 2010, at the outset of QE2, policymakers expressed their distaste for being called currency warriors they fully expected to be currency warriors. That’s why when Minister Mantego showed up on TV [declaring it a currency war] and all over the internet everyone just nodded their heads.”. What happens instead, what keeps happening, is that lower bond yields irrespective of QE correspond to rising dollar environments and both for the same background reason – the global dollar shortage. No, it’s the other labor market indications which continue to be alarmingly, historically terrifying. The S&P 500 has traded similarly, with a slightly higher limit. This speech will according to the media be consequential and change how the FED views inflation.

We did.”, Not only that, he then immediately and directly brought in the legendary printing press, how easy it was to crank the thing up to eleven and just take things Weimar, “We print it digitally. It looks to me as if one could say that the main effect of the asset-purchase program on real growth for the U.S. acts through the value of the dollar.”, One of the staff researchers present mildly corrected President Lacker, telling him that not all the calculated benefit was due to the downward dollar just the vast majority; “we decompose the effect as due about two-thirds to the dollar effect, with the remaining one-third being split roughly equally between the lower bond yields and the higher stock values.”. Stoic and staid, they might let you think that on their behalf, as Bernanke once did, but careful never to say or affirm too much. So as a central bank, we have the ability to create money digitally. And that’s Jay Powell’s job, he thinks. Any words you might try to use to accurately portray this situation would not have a “v” among them. The dollar’s crashing, they all say, with the major dollar index, DXY, down to its lowest level in years. Since the bond market has rejected this fantasy, those cheering Powell on have been forced to move on to increasingly tenuous interpretations of other markets. As the economy was switched off, can it be so easily, seamlessly switched back on? Economic theory posits that expectations are the whole thing, the entire ballgame. LACKER. They did. The true “V” revival. It could have been, long shot, but we’re stuck instead with officials who still have no idea what they are doing because no one has ever been honest with the public about what’s been going for a lot more than this year. Gold is skyrocketing – see! All this payroll report confirms is what we already knew – the economy is being reopened. Blatantly. The dollar isn’t crashing, it’s not even down, combined with gold and bonds all three remain firmly fixed within the same deflationary camp. The higher gold goes up, the more that corresponds to yields staying down.
Gold is skyrocketing – see! He had spent the month of March desperately catching up and then the month of April specifically appearing to overdo everything; on anything.

What was in that payroll report which seems to have shattered the inflationary magic? Some analysts expected Powell to address the specter of inflation and give some hint as to what might trigger a rate hike.

Dollar, people! They don’t consider that to be politically correct.”. To a lesser extent the yen. “But if the Fed was tanking the dollar, why didn’t the dollar tank? Therefore, the lower yields drop, and the more it looks like they’ll stay lower, the less opportunity cost gets put onto gold and the more easily it can surge higher. As you buckle up for the months ahead, as the consequences of more than a decade of confused, wannabe currency warriors play out in cities across the world, keep that in mind. How about just correct? While stocks have traded mostly sideways outside of FAANGs, bond yields have dropped across-the-board again (having never really backed up all that much in the first place; hysteria). While DXY is down recently, broader dollar indices, like individual currency crosses other than the euro, have barely moved. There was no surprise factor here, even as real GDP in the US crashed by a little more than a third (annual rate) during 2020’s troubled second three-month period. There isn’t a single part of the market/money/economy framework that these people get right; they simply recite passages from ancient textbooks written a very long time ago about a kind of system that hasn’t been relevant in ages. It is being bid up on the growing concern, shared by bonds, that at a time when real monetary policy has been and still is needed all a Federal Reserve Chairman can do is talk, lie, and try to sell a literal fiction. “MR. This monetary squeeze which makes the safest, most liquid instruments highly prized (and priced, thereby that’s what lowers their yields, not central bank bond buying) and pinches the value of the dollar upward – just like what happened in March 2020. Not just “V”, perhaps even better. WARSH.

In fact, gold’s price behavior over the last almost two years near perfectly matches…bonds.

For one thing, it’s old news. The balance of the discussion was weighing only those two possibilities; undertake QE2, more money printing, and risk the fallout from driving the dollar into the dirt; or, do nothing and let the unusually weak recovery stall even further. That’s how you know this inflation story has truly nothing behind it. But, as noted, it didn’t last past the following Monday. While bill equivalent yields press back into the single digits, much of the curve’s rates are once more setting record lows or are in reach of them. Since, the prior frenzied buying has been replaced by nearly two months of worried angst; enacting a sort of ceiling on the stock index. Behind much of it, Jay Powell was initially smiling. By God, Jay Powell’s done it! jpow.money - "/biz/ - Business & Finance" is 4chan's imageboard for the discussion of business and finance, and cryptocurrencies such as Bitcoin and Dogecoin. That’s another way to think about it. And it’s quite predictably falling apart.

No one expected that it would show up straight away in the CPI, Powell’s flood of money, but if it was anything other than the torrid, desperate fantasy of a Fed Chairman who realizes he’s in way over his head then it would get picked up, immediately, in TIPS (or swaps).

“MR. What the dollar is saying, again like the markets for bonds and gold, is simply this: Jay Powell is a fiction writer, only a barely adequate one for engaging the financial media in his purposes. Tomorrow Jerome Powell better known as Mr money printer is set to deliver a speech. Not to create - on his own - the forces which would shape it, rather to get you to do that work for him. With nominal Treasury yields sliding lower, that move in WTI ended up pushing real TIPS yields to oppressively negatives. Even those who do believe that there are real benefits in terms of net exports from weakening the foreign exchange value of the dollar are hesitant and rightly so to say those words in public venues. On Sunday, May 17, however, Chairman Powell appeared on the CBS News program 60 Minutes and…went nuts.
When Ben Bernanke’s FOMC voted to restart QE in November 2010, officials sitting around the table at that meeting worried quite a bit about it, how they’d be accused of setting a weaker dollar and using it beggaring-thy-neighbors. You deprive tens of millions of the opportunity to leave their house and attend to their jobs, once allowed they’re going to flood back in.”, Therefore, Powell didn’t actually change the game when he appeared on. A popular GIF portrays a crazed Powell at a lectern shooting out a cloud of dollar bills from a machine-gun-like printing press. Jobless claims may have bottomed out earlier this month, since turned upward again for two weeks in a row.


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