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Strategies & Market Trends : 2026 TeoTwawKi ... 2032 Darkest Interregnum -- Ignore unavailable to you. Want to Upgrade?

To: THE ANT who wrote (113082)	8/27/2015 7:32:01 AM
From: elmatador	Read Replies (1) \| Respond to of 217927

thanks. When capital was scare, people will bid high and higher to reward it with interest. Capital being aplenty, people don’t see the need to pay for something that is widely available. That is not to be construed as; cheap capital, dirigiste China that allocated it to increase growth and create jobs. Building infrastructure. But now you interrupt me and say: Wait a moment! Did not the US do the same by allocating cheap capital to save their banking system? Don’t you the parallel between building cities, malls, railways and airports in China? Keep with my line of argumentation for a while, which means: more capital=less interest rates. The only way to jack up interest rates is to make money scarce!

To: THE ANT who wrote (113082)	8/27/2015 7:36:18 AM
From: elmatador	Respond to of 217927

Fed Official Admits: No Way To Know If QE Worked BY TERRY JONES 08/20/2015 05:59 PM ET Thu, Aug 20 2015 00:00:00 E00_W With the Federal Reserve ready to reverse its now 7-year-old zero-interest rate policy, at least one official at the nation's central bank is having second thoughts about the experiment with Quantitative Easing — also known as QE. For the uninitiated, QE is when the Fed prints money to buy bonds from the government in an effort to keep interest rates low. The idea is that such purchases put more money into circulation, boosting consumer demand and raising prices. The Fed's QE experiment has been unprecedented, adding $4.5 trillion — no, that's not a misprint — to the Fed's balance sheet. Unfortunately, there's very little evidence that QE worked, noted St. Louis Federal Reserve Bank Vice President Stephen D. Williamson in a white paper that was flagged by ZeroHedge.com. Even the theory behind QE, Stephenson writes, is "not well developed." "All of (the) research is problematic," he said. One of the big hopes behind QE has always been that it would boost prices along with economic activity. But, says Williamson, "there is no way to determine whether asset prices move in response to a QE" or to what's called the "signaling effect," in which market participants guess what the Fed's interest rate policy will be based on its QE moves. The Fed has long had a 2% inflation target, but the actual inflation rate has remained below that. "There is no work, to my knowledge, that establishes a line from QE to the ultimate goals of the Fed on inflation and real economic activity," Stephenson wrote. "Indeed, casual evidence suggests that QE has been ineffective in increasing inflation." The reason is simple: Leaving the most important financial decisions in the nation to a handful of bureaucrats is a recipe for disaster. Sorry to say, but the Fed has repeatedly erred in conducting its policy, and has been implicated in most of our nation's postwar recessions. With Fed Chair Janet Yellen ready to embark on another policy shift in September with a rate hike, no one should be surprised if this, too, turns out to be the wrong move. Read More At Investor's Business Daily: http://news.investors.com/blogs-capital-hill/082015-767516-federal-reserve-official-says-no-proof-45-trillion-qe-program-did-anything.htm#ixzz3k0wsnjn1 Follow us: @IBDinvestors on Twitter \| InvestorsBusinessDaily on Facebook