You can only manipulate the financial system so much without causing a large disconnect in the free market. This week we briefly saw what can happen when too many people want to get cash out of a system the Federal Reserve has been micro-managing while trying to stimulate economic growth.
The Federal reserve cut interest rates for the first time since 2008. Since late 2015, they have raised short-term interest rates from near 0% to 2.25%. Since June when the Fed hinted at the chances they would cut rates at their next meeting, investors have poured money into the
This week the Federal Reserve gave every indication they are ready to cut interest rates as soon as July to fight a slowdown in economic growth (or at least that’s how the stock market participants took it.) Despite the celebration there are really only two outcomes for the
Back in 1997, while I was still in college I read a study from the Federal Reserve Bank of New York titled, “The Yield Curve as a Predictor of US Recessions.” This was in the early days of the development of my economic model, so I studied
On Wednesday the stock market got spooked when the Fed minutes revealed a lengthy discussion about how & when the Fed will begin to unwind its balance sheet. Many people have forgotten that it is NOT NORMAL for a central bank to hold so many assets on their books. In
