Debate is about September or December
by Greg Robb
Market Watch
It is no longer a question of “if” the Federal Reserve will raise rates, in the wake of the healthy July jobs report—the only question is “when.”
The July jobs report “should boost Fed policy committee members’ confidence in the outlook, especially following the unexpected weakness in second quarter gross domestic product, said Jesse Hurwitz, economist at Barclays.
“We continue to expect the Fed to hike rates at its September meeting, and we look to Chairwoman [Janet] Yellen’s appearance at the Jackson Hole Symposium on August 26 for confirmation of this view,” he added.
The Labor Department reported that the economy added 255,000 jobs in July, well above economists’ expectations for a gain of 185,000.
Yesterday the Bank of England cut its main interest rate from 0.5% to 0.25% for the first time, marking its first interest rate change since March 2009, and provided all of us with more reasons to keep converting fiat currencies into physical gold and physical silver. In addition the BOE announced an increase in its QE bond-buying program of £60bn to £435bn. And in response, the British pound immediately fell by 1% to the USD and traders added to their British pound longs, exceeding previous record net long positions in the pound recorded three years ago. I understand that traders are seeking a stronger rebound in the British pound after its plunge post-Brexit, and since the process for the UK to exit the EU has not even begun since the yes referendum vote, traders may be right to assume that the British pound will eventually rebound significantly in strength following this rate cut after people realize that a Brexit yes referendum vote may translate into an indefinite stay of limbo for the UK within the EU.
Libertarians are often skeptical about the idea of class struggle. This is no surprise, given how closely associated it is with Karl Marx. However, Marx did not originate the theory of class conflict, which was actually developed by the French liberals in the 19th century. In fact, it was classical liberal intellectuals in France, England, and the United States who spearheaded the early development of class theory.
Several years of rock-bottom interest rates around the world haven’t been all bad. They’ve helped reduce government borrowing costs, for sure. Central banks also send back to their governments most of the interest received on assets purchased through quantitative-easing programs. Governments essentially are paying interest to themselves.
Gold in sterling was 2.2% higher yesterday and was marginally higher in dollar terms after the Bank of England cut interest rates to all time, 322 year record low at 0.25% and surprised markets by renewing and aggressively expanding quantitative easing or QE.
[…] Dear Mr. Priebus:
I just listened to Obama give Washington’s account of the situation with ISIL in Iraq and Syria.
[…] In other words, what we may be seeing here is a declining ‘bang for the buck’ or ‘the law of diminishing returns’ for the massive amounts of liquidity which the Fed has been selectively applying to the financial system using quantitative easing.
Good morning and happy Friday to everyone. It is infusion confusion/recovery day for Chuck, so this will be another group effort and Frank will get things going for us this morning:
Right on the Money
The mainstream media (MSM) and the Democrat Party would like you to think it is the Republicans in full panic mode, but it is their party that’s freaking out. The first tip comes from the MSM that is “going to war against Trump” and acting like the true political hacks they are. Journalism is dead at the MSM, and they are willing to destroy their businesses to stop the outsider. Negative stories trashing Trump are not having an effect as Trump is packing rallies by the thousands while voter turnout for Clinton rallies is lackluster. Meanwhile, major negative stories about Hillary Clinton are being ignored to try to combat her negative image as a liar. Hillary even lies about what the FBI called lies about her private servers, and the MSM ignores developments such as the IRS opening an investigation into the Clinton Foundation.
The last two months alone have seen Britain leaving the European Union, terror attacks, cop killings, Deutsche Bank nearly collapsing, the German long term interest rates set at negative, to name a few.
Monetary policy, we are told, is all about staving off recession and stimulating economic growth.
On June 23rd, despite months of fear mongering by former Prime Minister David Cameron and his allies, doomsday global economic forecasts offered by the International Monetary Fund and the Obama Administration, and a steady drumbeat of anti-Brexit news stories by the BBC, The Economist and the Financial Times, the British people delivered an unexpected event to the global financial system by voting to take Britain out of the European Union. Despite the forecasts of doom and gloom, the people voted for freedom, democracy and common law.
If you are a taxpayer in the Land of the Free, you may have recently received a love letter from the Social Security Administration that went something like this:
…….Needless to say, the lack of good jobs lies at the bottom of the wealth and income drought on main street, and the recent BLS jobs reports provide still another reminder.
Political resistance to the oligarchy’s financialization skimming operations will eventually cripple central bank giveaways to the financial sector and corporate oligarchs.