All Entries Tagged With: "quantitativeeasing"
Euro Flash Crash – Market Correlation Lives On
Early on Wednesday, U.S. futures traded higher. The results of an Italian debt auction came in better than expected, and may have lifted the hopes of traders. Then, right around 10am ET, the EUR/USD pair began to crash—significantly. The pair moved down roughly 0.60% in about 10 minutes, which is a huge move for a [...]
Draghi Disappoints the Market
On Thursday, the European Central Bank (ECB) opted to cut its benchmark interest rate, dropping the figure by 25 basis points from 1.25% to 1.00%. There had been some market chatter that the rate could be cut to 0.75%. This is the second interest rate cut for Mario Draghi, the ECB’s new president, and comes [...]
US Senate to Force Trade War with China?
On Monday, the U.S. senate voted to begin the debate on a bill that would place trade restrictions on countries deemed to be undervaluing their currencies. The Chinese would be the key target of the bill, as China has been widely characterized as a currency manipulator by many economic commentators. On Tuesday, the Chinese government [...]
Is Bernanke Out of Bullets?
On Thursday last week, the Chairman of the Federal Reserve—Ben Bernanke—gave a speech in Minneapolis. In his speech, Bernanke addressed the current economic climate and the possibility of further Fed support. In recent weeks, some market commentators have begun to characterize the Fed as being “out of bullets.” Some have alleged that, after two consecutive [...]
Forget QE3, Bring On OT2?
On Friday, the Chairman of the Federal Reserve Ben Bernanke will give his annual Jackson Hole speech. Anticipation is running high that Bernanke will use the opportunity to present a new plan to boost the economy. Last year, Bernanke used his speech at Jackson Hole to lay the groundwork for the second round of quantitative [...]
Will The Fed’s Regional Governors Prevent QE3?
On Tuesday, the Federal Open Market Committee (FOMC) met to discuss interest rate policy. Predictably, the FOMC left rates near zero. The market was more concerned about possible future asset purchases, so-called QE3. The FOMC has thus far conducted two rounds of asset purchases known as QE1 and QE2. Given the recent deterioration in the [...]
Trichet Will Intervene Again in an Effort to Save the Eurozone
On Thursday, the president of the European Central Bank (ECB) Jean-Claude Trichet conducted a press conference. In the conference, Trichet stated that the ECB would resume purchasing European bonds in an effort to prevent the debt crisis from worsening in Spain and Italy. On Wednesday, Italy’s Prime Minister Silvio Berlusconi addressed the Italian parliament in [...]
Swiss Bankers Fight Back, Making the Franc Less Attractive to Investors
It may be said that currency markets have been especially volatile over the course of the past few years. This might be no surprise given the extraordinary actions of central banks around the world in the wake of the 2008 global financial crisis. Some currencies may have shifted due to the actions of their issuing [...]
Even With a Downgrade, Dollar’s Reserve Status May Not Go Away
John Taylor, the founder of the world’s largest currency-hedge fund, said the U.S. dollar would remain the world’s reserve currency, even if the ratings agencies opt to downgrade the U.S.’s debt in the face of the debt ceiling increase. “There is no alternative to the dollar in the next five to 10 years,” Taylor stated, [...]
Should Investors Flee to the U.S. Dollar?
With global economic conditions deteriorating, uncertainty in the financial markets may be at an all-time high. Reuters cites feedback from financial advisors in a piece released Tuesday, alleging that more and more, investors—particularly those close to retirement—are seeking an exit from equity portfolios, fearing a repeat of 2008′s financial calamity. Despite a strong start to [...]
