An approaching financial crisis — reality or myth?
The data seen so far in Q2 are somewhat better than Q1, and Q1’s real GDP growth has been upgraded from a miserable 0.5 percent to a miserly 0.8 percent. The U.S. economy remains in first gear, mainly due to the oil patch and continued sluggish manufacturing activity. With such poor results from a record-breaking […]
Anti-growth policies hurt investors
The stall-out in the U.S. economy and in most major world economies has baffled policymakers. No matter what they try in today’s economic environment, it hasn’t worked for more than a short period of time. Quantitative easing appeared to work when first tried during the Great Recession, but now, as Japan and Europe have found, […]
The Possibility of Negative Interest Rates on Your Deposits – Part I
The very concept of negative interest rates appears, at least at first blush, to be an oxymoron. What rational entity would “loan” money and expect, under the contract, to get less back than loaned? If you think “no one would,” think again! In this two part narrative, I explain how this is possible, how it […]
Should investors worry QE3 has ended?
Originally published on RGJ.com’s website http://www.rgj.com/story/money/business/2014/11/16/robert-barone-investors-worry-qe-ended/19080941/ As October ended, the Fed announced an end to its controversial money printing policy, known as QE3 (the third round of quantitative easing). In QE3, the Fed purchased large quantities of U.S government securities. When the Fed purchases bonds, it creates new money in the form of bank reserves. […]
Fed policy and your retirement portfolio
Originally published in MarketWatch.com http://www.marketwatch.com/story/fed-policy-and-your-retirement-portfolio-2014-08-07 At the most recent Federal Open Market Committee meeting, Chairwoman Janet Yellen reiterated that the economy is improving and deflation risks are disappearing. The Fed is planning on ending its QE, or quantitative easing, program in October and hasn’t signaled that it will begin raising rates before next summer in […]
Are Equities Overvalued? Are We in a Bubble?
It is a mistake to equate the two questions. There is concrete evidence that equities are overvalued, mainly due to the monetary policies of the Fed and the world’s other major central banks. And there are clearly some stocks that are in bubble land (those that have stratospheric P/E ratios). There are ongoing massive liquidity […]