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+--- Thread: Bernanke: more fed stimulus on the way (/showthread.php?tid=140906)
Bernanke: more fed stimulus on the way - Lemon Drop - 08-31-2012
"Importantly, the effects of LSAPs (large-scale asset purchases) do not appear to be confined to longer-term Treasury yields. Notably, LSAPs have been found to be associated with significant declines in the yields on both corporate bonds and MBS.14 The first purchase program, in particular, has been linked to substantial reductions in MBS yields and retail mortgage rates. LSAPs also appear to have boosted stock prices, presumably both by lowering discount rates and by improving the economic outlook; it is probably not a coincidence that the sustained recovery in U.S. equity prices began in March 2009, shortly after the FOMC's decision to greatly expand securities purchases. This effect is potentially important because stock values affect both consumption and investment decisions. "
http://www.federalreserve.gov/newsevents/speech/bernanke20120831a.htm
So that low mortgage rate you've got might get even lower.
Re: Bernanke: more fed stimulus on the way - Avenger - 08-31-2012
Looks like Chinese aren't buying. What a scam! We are lending to ourselves. Obama is lighting the fuse under the economy just before leaving.
Re: Bernanke: more fed stimulus on the way - cbelt3 - 08-31-2012
This is one hyper-complex piece of documentation. Thanks for sharing. After a brief skim, it appears that the Fed has successfully reduced their long term liability by reducing the long term yield of their debts. In other words, the interest rate that 'we' pay for this debt ?
I'm not sure how this fits with the 'national debt' concept, which is more of a political football than an actual idea.
Unfortunately in dealing with documents replete with the arcane jargon of specialized thinkers, one must usually defer to the opinions of such thinkers. If Wall Street thinks this is a godo thing, then.. perhaps it is.
Re: Bernanke: more fed stimulus on the way - Avenger - 08-31-2012
I gave a one line synopsis of this "hyper-complex" document. Where am I wrong?
Re: Bernanke: more fed stimulus on the way - Lemon Drop - 08-31-2012
cbelt3 wrote:
This is one hyper-complex piece of documentation. Thanks for sharing. After a brief skim, it appears that the Fed has successfully reduced their long term liability by reducing the long term yield of their debts. In other words, the interest rate that 'we' pay for this debt ?
I'm not sure how this fits with the 'national debt' concept, which is more of a political football than an actual idea.
Unfortunately in dealing with documents replete with the arcane jargon of specialized thinkers, one must usually defer to the opinions of such thinkers. If Wall Street thinks this is a godo thing, then.. perhaps it is.
Yeah - 24 pages worth.
Jared Bernstein's take on it is pretty good I thought.
http://www.huffingtonpost.com/jared-bernstein/bernanke-speech-fed_b_1847649.html
What is interesting is that in order to prevent low interest rates from creating another asset-bubble like the one that killed us in '08, we need strict financial oversight as provided with Dodd-Frank. And of course, a President Romney wants to repeal that.
We've either learned the lessons of this recession, or we haven't.
We'll see.
Re: Bernanke: more fed stimulus on the way - Lemon Drop - 08-31-2012
Avenger wrote:
I gave a one line synopsis of this "hyper-complex" document. Where am I wrong?
You're wrong about Obama leaving.
Others can cover the rest if they're interested.
Re: Bernanke: more fed stimulus on the way - Speedy - 09-03-2012
At least the world knows we are good for our debt (notwithstanding an often wrong rating company.) And the Republicans certainly can't be bothered to help improve the economy since they are doing so well.