Kudos to MMs

Why? The two mandates for the FED is "full" employment and inflation under control. How long do you have to run a low IR experiment to realize that it is not working as far as employment is concerned? To me, it is inflation that is the wild card. I seriously have no idea what the FED thinks inflation is. I have come to a cursory conclusion that prices could be even higher than they are now, but if employment was kept low, they would not deem that [bad] inflation. They are only worried about inflation when it comes from workers driving prices higher, not speculators/the market....
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"The High Costs of Very Low Interest Rates

The prevailing view among economists, policy makers and Federal Reserve Board governors is that a zero or near-zero short-term interest rate stimulates the economy—the lower the rate, the better. It is time to re-examine this conventional wisdom. In fact, lowering interest rates too much may not stimulate recovery, but actually slow it. Yes, there are benefits from zero rates, but not nearly enough to outweigh their pernicious consequences..."

http://online.wsj.com/article/SB100...876165452.html?mod=WSJ_Opinion_LEFTTopOpinion

"The Fed Can't Solve Our Economic Woes

A policy of low interest rates is a textbook response of monetary authorities to the economic weakness brought on by deficient aggregate demand. The policy is justified by pointing to various ways in which money can promote economic activity—including by stimulating investment, discouraging savings, encouraging consumption spending, and allowing individuals to lower their debt burdens by refinancing existing debt. While these effects are theoretically plausible, this textbook policy does not apply to our present situation..."

http://online.wsj.com/article/SB100...418964014417740.html?mod=WSJ_newsreel_opinion
 
Quote from nitro:

NFV 1086.49. SPX 1086.32.

Zero edge.
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Still thinking the Fed will raise rates?The debate now should be whether the Fed will raise in 2012, because 2011 in my view is looking quite unlikely, more and more by the day
 
Quote from Daal:

Still thinking the Fed will raise rates?The debate now should be whether the Fed will raise in 2012, because 2011 in my view is looking quite unlikely, more and more by the day
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I don't know any more. But look at the relevant posts to WSJ articles on the last page.
 
Quote from johnnyqpublic:

Is NFV also up another 10 handles?
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NFV is at 1087.85. SPX at 1099.26. If we went out here, you would definetly want to short ESU0 as close to 3:15 CT as possible (or wait for the reopen of the minis in the AHs - the decision to wait or not wait depends on earnings and possible news and is more art than science) and try to get a few handles overnight.

Remember, anything 7 to 14 in edge is meant for overnight session trading only. If we had > 14 edge, we could take it any time during the session.
 
Quote from nitro:

"The High Costs of Very Low Interest Rates

The prevailing view among economists, policy makers and Federal Reserve Board governors is that a zero or near-zero short-term interest rate stimulates the economy—the lower the rate, the better. It is time to re-examine this conventional wisdom. In fact, lowering interest rates too much may not stimulate recovery, but actually slow it. Yes, there are benefits from zero rates, but not nearly enough to outweigh their pernicious consequences..."

http://online.wsj.com/article/SB100...876165452.html?mod=WSJ_Opinion_LEFTTopOpinion

"The Fed Can't Solve Our Economic Woes

A policy of low interest rates is a textbook response of monetary authorities to the economic weakness brought on by deficient aggregate demand. The policy is justified by pointing to various ways in which money can promote economic activity—including by stimulating investment, discouraging savings, encouraging consumption spending, and allowing individuals to lower their debt burdens by refinancing existing debt. While these effects are theoretically plausible, this textbook policy does not apply to our present situation..."

http://online.wsj.com/article/SB100...418964014417740.html?mod=WSJ_newsreel_opinion
More...
"Fed's Hoenig: Keeping Rates Too Low 'Dangerous Gamble

The Federal Reserve is undertaking a "dangerous gamble" by keeping rates at near zero for so long, and must start raising rates or risk damaging the nascent U.S. recovery, a top Federal Reserve official said on Friday..."

http://www.cnbc.com/id/38693128
 
Didnt you go to the uni of Chicago?They are doing the standard correct response that prevents a 30's type outcome, as people delever and paydown debt the money supply decreases, the fed HAS to lever up to prevent a 30's type M2 collapse. Otherwise we see massive deflation

They purchased $1.7T in assets, $1T became excess reserves, $700b became money supply, without that M2 yoy would have been deeply negative and interest rates would gone down ANYWAY, as everyone and their wifes would buy USTs. If you want higher rates then you want to see more QE, cuz thats the only thing that will get US CPI up a lot again in your lifetime
 
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