Brief and delayed recap:
Looks like Goldilocks is officially here. 4% GDP gwth and 0% core inflation.
Agreed, remains a good market for stocks apart from looming shocks from Europe and elsewhere that could do a lot of damage.
Tax hikes can do damage but they are off in the future for now.
I describe 4% gdp as more L shaped than V shaped, but that’s just semantics. It’s modest growth that will very gradually bring down unemployment.
In the end, growth will be important to the Fed as it leads inflation. Look for Bernanke to continue to tweak extended period language today.
- Retail sales up 1.6% with upward revisions to Jan and Feb
- Control group up 0.5% and 3mth annualized rate for control group jumped to 7.4% from 5.2%
- Looks like 4% GDP growth in Q1
- Core CPI up 0.05%; helped largely by another 0.1% drop in OER
- 3mth annualized rate of core inflation now -0.1%
4% GDP for the year and you can expect the unemployment rate to be above 9% at the end of the year.
This is progress?
Exhibit 11 – larger deficits do not mean higher interest rates according to Koo
Yet Bernanke says this – how did he get reappointed? The nation got the fed chairman it deserved.
Under an alternative scenario that drops those assumptions, the
deficit at the end of 2020 would be 9 percent of GDP and the federal
debt would balloon to more than 100 percent of GDP. Although sizable
deficits are unavoidable in the near term, maintaining the confidence of the public and financial markets requires that policymakers move
decisively to set the federal budget on a trajectory toward sustainable fiscal balance. A credible plan for fiscal sustainability could yield substantial near-term benefits in terms of lower long-term interest rates and increased consumer and business confidence. Timely attention to these issues is important, not only for maintaining credibility, but because budgetary changes are less likely to create hardship or dislocations when the individuals affected are given adequate time to plan and adjust. In other words, addressing the countrys fiscal problems will require difficult choices, but postponing them will only make them more difficult.
Read more: http://www.businessinsider.com/ben-bernanke-text-speech-congress-2010-4#ixzz0l5VaOiuJ
Bill Mitchell: Deficits are here to stay … get used to it
Bill shows why in terms of sectoral balances and national accounting.
MIke Norman: Total loans surge $428 billion in the latest week
Someone might want to let him know there was a onetime adjustment. I’ve made the same mistake.
Notes on the Data (billions of dollars)
As of the week ending March 31, 2010, domestically chartered banks and foreign-related institutions had consolidated onto their balance sheets the following assets and liabilities of off-balance-sheet vehicles owing to the adoption of FASB’s Financial Accounting Statements No. 166 (FAS 166), Accounting for Transfers of Financial Assets, and No. 167 (FAS 167), Amendments to FASB Interpretation No. 46(R). Domestically chartered commercial banks consolidated $377.8 billion in assets and liabilities. The major asset items affected were: other securities, mortgage-backed securities, -$5.6; other securities, non-MBS, -$15.9; commercial and industrial loans, $32.3; real estate loans, revolving home equity loans, $5.8; real estate loans, closed-end residential loans, $21.5; real estate loans, commercial real estate loans, $1.2; consumer loans, credit cards and other revolving plans, $323.9; consumer loans, other consumer loans, $41.3; other loans and leases, $8.3; allowance for loan and lease losses, $36.4; cash assets, $2.4; trading assets, other trading assets, -$1.7; and other asset items, $0.7. The major liability items affected were: deposits, large time deposits, $2.7; borrowings, borrowings from banks in the U.S., $4.4; borrowings, borrowings from others, $391.6; and other liability items, $5.1. The residual (assets less liabilities) decreased $25.9. The major memoranda items affected were: securitized credit cards and other revolving plans, -$351.3; other securitized consumer loans, -$23.3; and securitized real estate loans, -$25.7. Foreign-related institutions consolidated $20.7 billion in assets and liabilities. The major asset items affected were: other securities, non-MBS, $1.1; commercial and industrial loans, $0.7; and other loans and leases, $18.9. The major liability items affected were: deposits, other deposits, $0.5; borrowings, borrowings from others, $21.0; net due to related foreign offices, -$12.0; and other liabilities, $11.2. The major memoranda items affected were: securitized credit cards and other revolving plans, $7.3.
Anybody see this. The big 4 with the help of the fed are fighting
to avoid public disclosure of TARP details.
On a day when when JP morgan chase reports a record fixed-income trading revenue
Is it true the fed holds credit default swaps against florida and nevada debt? I really don’t understand what they are afraid of, it is like when hugh grant picked up that streetwalker, everyone eventually forgave him and it is all now forgotten. Why not just disclose all the tarp secrets and move on, most people won’t care and the few that do can’t really influence the billions of masses who don’t – ask william black if you don’t believe me. Why fight it? Amazing at the sillyness of some people who take themselves and thier secrets way too seriously. I am certain not one person here is willing to pick up a gun like george washington did and go shoot some folks who are trying to control things like loans and taxes. As Warren often says, there is a guy in the room with a 9mm and no one is brave enough to rush him – there was that one guy in Texas who just flew his airplane into the IRS building, but that is a rare exception.