Linkfest: Exiting QE; Bernanke’s legacy; Secular stagnation and disinflation; Fixing CAPE
Categories: Linkfest
Today’s most shared: Fed figuring out how to exit QE… TIPS signal inflation undershoot… Bernanke’s legacy… Summers on secular stagnation… EU Commissioner on enduring orthodoxy… Red tape suggests winding up a failing bank will be easier said than done… Fixing the CAPE… How Bank of America stymied loan modifications… Increasing inequality in the US.
Fed wants to exit QE but keep long-term rates low
MarketWatch
The Federal Reserve wants to exit QE but at the same time keep long-term interest rates low. Figuring out how to do that may take until early next year.
shared by @ritholtz, @Fullcarry, reddit/Economics, @HamzeiAnalytics
MarketWatch
The Federal Reserve wants to exit QE but at the same time keep long-term interest rates low. Figuring out how to do that may take until early next year.
shared by @ritholtz, @Fullcarry, reddit/Economics, @HamzeiAnalytics
TIPS Wipeout Signals Fed Losing Fight Against U.S. Disinflation
Bloomberg
Bond investors are signaling they expect the Federal Reserve to lose its battle against disinflation, even after inundating the U.S. economy with more than $3 trillion in the past five years.
shared by @edwardnh, @cate_long, @rortybomb
Bloomberg
Bond investors are signaling they expect the Federal Reserve to lose its battle against disinflation, even after inundating the U.S. economy with more than $3 trillion in the past five years.
shared by @edwardnh, @cate_long, @rortybomb
US Federal Reserve: The Bernanke years
Financial Times
It was a drizzly day in Washington when Ben Bernanke went to his confirmation hearing in November 2005, but all seemed bright for the US economy. Growth was on track to hit 3 per cent. House prices had another five months left to rise.
shared by @TheStalwart, @mccarthyryanj, @BCAppelbaum, @JEliasof, @IvanTheK, @moorehn
Financial Times
It was a drizzly day in Washington when Ben Bernanke went to his confirmation hearing in November 2005, but all seemed bright for the US economy. Growth was on track to hit 3 per cent. House prices had another five months left to rise.
shared by @TheStalwart, @mccarthyryanj, @BCAppelbaum, @JEliasof, @IvanTheK, @moorehn
Summers: Why stagnation might prove to be the new normal
Financial Times
Is it possible that the US and other major global economies might not return to full employment and strong growth without the help of unconventional policy support? I raised that notion – the old idea of “secular stagnation” – recently in a talk hosted by the International Monetary Fund.
shared by Business Insider, @TNYJohnCassidy, @petereavis, @ObsoleteDogma
Financial Times
Is it possible that the US and other major global economies might not return to full employment and strong growth without the help of unconventional policy support? I raised that notion – the old idea of “secular stagnation” – recently in a talk hosted by the International Monetary Fund.
shared by Business Insider, @TNYJohnCassidy, @petereavis, @ObsoleteDogma
László Andor: Can we move beyond the Maastricht orthodoxy?
VOX
shared by @MatinaStevis, @SonyKapoor, Naked Capitalism, @NickMalkoutzis
VOX
shared by @MatinaStevis, @SonyKapoor, Naked Capitalism, @NickMalkoutzis
Rules for failing banks raise prospect of eurozone red-tape burden
Financial Times
Fears are growing that the eurozone’s proposed new banking regime will be too bureaucratic for the task of handling a sudden collapse of a cross-border institution. The latest proposals could see up to 126 people being consulted on how to wind up a bank, even though agreement might need to be reached over the course of a weekend while financial markets are closed.
shared by @economistmeg, Naked Capitalism, @FGoria, @mhewson_CMC
Financial Times
Fears are growing that the eurozone’s proposed new banking regime will be too bureaucratic for the task of handling a sudden collapse of a cross-border institution. The latest proposals could see up to 126 people being consulted on how to wind up a bank, even though agreement might need to be reached over the course of a weekend while financial markets are closed.
shared by @economistmeg, Naked Capitalism, @FGoria, @mhewson_CMC
Fixing the Shiller CAPE: Accounting, Dividends, and the Permanently High Plateau
philosophicaleconomics.wordpress.com
For most of history, the Shiller Cyclically-Adjusted Price-Earnings ratio (CAPE) oscillated in a pseudo sine wave around a long-term (130 year) average of 15.3. It spent 55% percent of the time above the average, and 45% of the time below–a reasonable result for a metric that allegedly mean reverts. Since 1990, however, the metric has only spent 2% of the time below its historical average–98% of the time above.
shared by @derekhernquist, reddit/Economics, @JacobWolinsky, @BarbarianCap
philosophicaleconomics.wordpress.com
For most of history, the Shiller Cyclically-Adjusted Price-Earnings ratio (CAPE) oscillated in a pseudo sine wave around a long-term (130 year) average of 15.3. It spent 55% percent of the time above the average, and 45% of the time below–a reasonable result for a metric that allegedly mean reverts. Since 1990, however, the metric has only spent 2% of the time below its historical average–98% of the time above.
shared by @derekhernquist, reddit/Economics, @JacobWolinsky, @BarbarianCap
Secret Inside BofA Office of CEO Stymied Needy Homeowners
Bloomberg
Instead of helping homeowners as promised under agreements with the U.S. Treasury Department, Bank of America stalled them with repeated requests for paperwork and incorrect income calculations.
shared by @HamzeiAnalytics, @BCAppelbaum, @davidenrich, Here Is The City
Bloomberg
Instead of helping homeowners as promised under agreements with the U.S. Treasury Department, Bank of America stalled them with repeated requests for paperwork and incorrect income calculations.
shared by @HamzeiAnalytics, @BCAppelbaum, @davidenrich, Here Is The City
Gold Funds See Unprecedented 31% Slump With World Losing Faith
Bloomberg
Investors are dumping gold-backed exchange-traded products at the fastest pace since the securities were created a decade ago, mirroring the steepest price drop in 32 years.
shared by reddit/Economics, @ritholtz, @BarbarianCap, @JohnLothian
Bloomberg
Investors are dumping gold-backed exchange-traded products at the fastest pace since the securities were created a decade ago, mirroring the steepest price drop in 32 years.
shared by reddit/Economics, @ritholtz, @BarbarianCap, @JohnLothian
Stories From 1999 – Joe Fahmy The Next Big Move
joefahmy.com
I recently wrote a blog post titled “This is NOT a Bubble!” At the end of the post, I said I would tell a few stories from 1999 to emphasize my point that we are NOWHERE CLOSE to the bubble and the euphoria we saw back then. Enjoy!
shared by @JacobWolinsky, @ReformedBroker, @bclund, @TheBasisPoint
joefahmy.com
I recently wrote a blog post titled “This is NOT a Bubble!” At the end of the post, I said I would tell a few stories from 1999 to emphasize my point that we are NOWHERE CLOSE to the bubble and the euphoria we saw back then. Enjoy!
shared by @JacobWolinsky, @ReformedBroker, @bclund, @TheBasisPoint
It’s Not OK That Your Employees Can’t Afford to Eat
HBR
Scrooge is alive and well.
shared by @edwardnh, @TMFHousel
HBR
Scrooge is alive and well.
shared by @edwardnh, @TMFHousel
Inequality, Ezra, Paul, and the Unifying Theory (and Evidence)
jaredbernsteinblog.com
The President recently averred that inequality is the defining challenge of our time. Ezra Klein argues that perhaps growth and unemployment better represent that challenge. Paul Krugman offers four strong reasons why, no, inequality is a fine candidate for that role.
shared by @rodrikdani, reddit/Economics, @MarkThoma, @ezraklein
jaredbernsteinblog.com
The President recently averred that inequality is the defining challenge of our time. Ezra Klein argues that perhaps growth and unemployment better represent that challenge. Paul Krugman offers four strong reasons why, no, inequality is a fine candidate for that role.
shared by @rodrikdani, reddit/Economics, @MarkThoma, @ezraklein
Four Ways to Visualize US Income Inquality
visualizingeconomics.com
shared by Business Insider, @JustinWolfers, @pdacosta, @Kelly_Evans
visualizingeconomics.com
shared by Business Insider, @JustinWolfers, @pdacosta, @Kelly_Evans
The Keynesian Revolution, the Monetarist Counterrevolution, the New Classical Purge, the Neo-Keynesian Restoration
equitablegrowth.org
shared by @delong, @BCAppelbaum, @MarkThoma, reddit/Economics, @Noahpinion
equitablegrowth.org
shared by @delong, @BCAppelbaum, @MarkThoma, reddit/Economics, @Noahpinion
You Can Get Some Big Things Done When It’s Not All About You
HBR
Lessons from Vanguard’s Jack Bogle.
shared by @abnormalreturns, Abnormal Returns, @JacobWolinsky
HBR
Lessons from Vanguard’s Jack Bogle.
shared by @abnormalreturns, Abnormal Returns, @JacobWolinsky
London Bankers Expect 44% Bonus Increase, Survey Finds
Bloomberg
Managing directors at banks in London are expecting a 44 percent rise in bonuses for 2013 even as European authorities seek to scale back compensation, according to a recruiter’s survey.
shared by NYT Dealbook, @FGoria, Here Is The City, @pdacosta
Bloomberg
Managing directors at banks in London are expecting a 44 percent rise in bonuses for 2013 even as European authorities seek to scale back compensation, according to a recruiter’s survey.
shared by NYT Dealbook, @FGoria, Here Is The City, @pdacosta
Hey, Economists: People Are Complicated
Bloomberg
The field of economics is desperately in need of a paradigm shift if it wants to play a role in improving the lot of humanity. Instead, mainstream economists keep trying to get away with tiny tweaks in their fundamentally flawed way of looking at the world.
shared by @ritholtz, @MarkThoma, reddit/Economics, @edwardnh, @moorehn
Bloomberg
The field of economics is desperately in need of a paradigm shift if it wants to play a role in improving the lot of humanity. Instead, mainstream economists keep trying to get away with tiny tweaks in their fundamentally flawed way of looking at the world.
shared by @ritholtz, @MarkThoma, reddit/Economics, @edwardnh, @moorehn
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