A ‘Buy Everything’ Rally Beckons in World of Yield Curve Control

[Arnie]

As central banks pump trillions into the world economy, investors are setting their sights on what could be the next big thing in global monetary policy: yield curve control.

The strategy, which involves using bond purchases to pin down yields on certain maturities to a specific target, was once deemed an extreme and unusual measure, only deployed by the Bank of Japan four years ago after it became clear that a two-decade deflationary spiral wasn’t going away.

No longer. This year, the Reserve Bank of Australia adopted its own version. And despite officials’ attempts to cool it, speculation is rife that the U.S. Federal Reserve and Bank of England will follow later this year.

Should yield curve control go global, it would cement markets’ perception of central banks as the buyers of last resort, boosting risk appetite, lowering volatility and intensifying a broader hunt for yield. While money managers caution that such an environment could fuel reckless investment already stoked by a flood of fiscal and monetary stimulus, they nonetheless see benefits rippling across credit, equities, gold and emerging markets.

Read more...

https://www.bloomberg.com/news/arti...rally-beckons-in-world-of-yield-curve-control

 

[murray t turtle]

As central banks pump trillions into the world economy, investors are setting their sights on what could be the next big thing in global monetary policy: yield curve control.

The strategy, which involves using bond purchases to pin down yields on certain maturities to a specific target, was once deemed an extreme and unusual measure, only deployed by the Bank of Japan four years ago after it became clear that a two-decade deflationary spiral wasn’t going away.

No longer. This year, the Reserve Bank of Australia adopted its own version. And despite officials’ attempts to cool it, speculation is rife that the U.S. Federal Reserve and Bank of England will follow later this year.

Should yield curve control go global, it would cement markets’ perception of central banks as the buyers of last resort, boosting risk appetite, lowering volatility and intensifying a broader hunt for yield. While money managers caution that such an environment could fuel reckless investment already stoked by a flood of fiscal and monetary stimulus, they nonetheless see benefits rippling across credit, equities, gold and emerging markets.

Read more...

https://www.bloomberg.com/news/arti...rally-beckons-in-world-of-yield-curve-control

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Superstrong summer rally; I had planned on more inverse etfs, but price does not signal that=yet.
I would not be surprised if we have a record downside SEPT/ but oct nov/election superstrong bullmarket/ uptrend.
DAL may go bankrupt, fake news may blame virus/LOL but DAL went bankrupt before virus...……………………………………………………...………………………………………………………………………………………...

 

[Specterx]

As central banks pump trillions into the world economy, investors are setting their sights on what could be the next big thing in global monetary policy: yield curve control.

The strategy, which involves using bond purchases to pin down yields on certain maturities to a specific target, was once deemed an extreme and unusual measure, only deployed by the Bank of Japan four years ago after it became clear that a two-decade deflationary spiral wasn’t going away.

No longer. This year, the Reserve Bank of Australia adopted its own version. And despite officials’ attempts to cool it, speculation is rife that the U.S. Federal Reserve and Bank of England will follow later this year.

Should yield curve control go global, it would cement markets’ perception of central banks as the buyers of last resort, boosting risk appetite, lowering volatility and intensifying a broader hunt for yield. While money managers caution that such an environment could fuel reckless investment already stoked by a flood of fiscal and monetary stimulus, they nonetheless see benefits rippling across credit, equities, gold and emerging markets.

Read more...

https://www.bloomberg.com/news/arti...rally-beckons-in-world-of-yield-curve-control

YCC and still more extreme policies are on the way. Perhaps with a nasty dip or two between now and then, perhaps not. From the Fed's perspective intervention has many benefits but no costs, so why stop here?

Escalating government support for financial markets has been a trend in progress since at least 1987, and will continue until acted on by a sufficient contrary force.

 

[Arnie]

I think it started in 1977.

 

[markteshorn]

That’s true from the Fed’s approach it has many benefits.

 

[Petechiapeter]

It is important for you to make a note that central banks get involved in foreign exchange markets not related to their country’s concern but the relative concerns at the international level.
Several central banks may come together and join hands to conduct foreign exchange in order to provide liquidity and credit across the world.