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2013 Commentaries

Spoos and Chartruese Love Tapering!!

We just saw one of the “easiest” Fed removals of accommodation in history. And as mentioned previously, this meeting was one of the closest calls in recent memory. Here is what I wrote on Dec 10th in a commentary entitled “Smaller or Later Redux” – “As for the market reaction to the upcoming FOMC meeting, […]

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Stan is a Stud, Not a Hawk

The news of Stan Fischer’s appointment to the Federal Reserve Board as vice chairman for monetary affairs did not seem to generate any market cheer last week. After the announcement many folks quickly scanned the recent press to obtain a better handle on his views. What they found were his rather skeptical comments on forward […]

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Smaller or Later Redux

The employment data last week was certainly strong enough for the Fed to move ahead with a taper at the upcoming FOMC meeting. A 7% unemployment rate with a RISING participation rate and a 200K handle on payrolls is about as good as we could have wished for. And the most beautiful part of the […]

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Alvin Hansen Rises from the Dead

“The economy cannot on its own generate enough steam to provide our full potential of growth” – Alvin Hansen, “The Stagnation Thesis” (1954) The first economist to use the term “secular stagnation” was Harvard Professor Alvin Hansen in his 1938 work entitled “Full Recovery or Stagnation?”. This concept seems to have found a new lease […]

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A Pigouvian Tax on Leverage

With Janet’s hearings out of the way, there is little to focus on with regards to Fed policy into year-end. The next major event will be November payrolls, but even a big print will not likely catalyze a taper. With all the talk of lower unemployment thresholds, higher inflation tolerances, nominal GDP targeting, endogenous supply […]

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Dammit Janet, I Love You...

Days like yesterday are simply magical – spoos +14 and EDZ6 +16; it just doesn’t get any better. The risk market and the risk-free markets were both strong to start the day, on rumors that the Fed might lower the IOER in conjunction with an initial taper. What a fantastic idea! Every day I think […]

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