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Tag: inflation
The Fed resumed its overly modest QT program this week. It is better than zero activity. We'll take it. We would like to see the Fed rid its balance sheet of the excesses of 2020-2022 over the next several years at a clip of approximately $1.5 Trillion per year. Treasuries: The Fed’s Treasury security holdings declined … Continue reading The Fed’s Balance Sheet Reduction (QT) Update
This week’s BTFP activity: The Bank Term Funding Program (BTFP, bail out/QE) had approximately $107.6 billion in outstanding loans as of Wednesday this week, down from $108.0 billion (- $0.4 billion) a week ago. The “other credit extensions” line item of $85.0 billion includes the FDIC loans made to regional banks. This figure is down from $133.4 … Continue reading Weekly Update: Bank Term Funding Program
The Fed created the mess that we are living in as it relates to the price dislocations we have suffered across goods, services and various asset classes since 2H 2020. Too much is being made of today's Fed rate decision and the related projections below. Not enough is being made of the Fed's anemic QT … Continue reading Today’s FOMC Meeting: Much Ado About Nothing
A Government budget deal will get done regardless of a looming Government shutdown. The $33 Trillion Treasury debt load is about to go much higher, and with that the purchasing power of the Dollar much lower (i.e. inflation). Rates are going lower next year as the interest expense burden on the debt outstanding is unsustainable. … Continue reading I Am Sorry To Say That Inflation Is Here To Stay
Yes, the GOP and Dems will get a deal done - Government shutdown / political theater notwithstanding - as both parties lack fiscal restraint. Treasury debt will continue to grow. Treasury debt sits at $32.96 Trillion as of September 13th and that number is going much, much higher! 2024 and 2025 and beyond will see … Continue reading Debt Mountain: Yes, A Fiscal Deal Will Get Done
The Fed may as well end QT. It has only trimmed its balance sheet by $1.03 Trillion since May 2022. This after growing its balance sheet from $4.0 Trillion in October 2019 to a peak of $9.0 Trillion in March 2022. The Fed's balance sheet stands at $8.1 Trillion today. Yet we wonder why inflation … Continue reading The Fed’s Balance Sheet Reduction (QT) Update
The U.S. Bureau of Labor Statistics will publish August CPI figures tomorrow morning at 8:30am ET. Our view is that we will get a flattish month-to-month Headline CPI figure and something in the 3.6% range for the year-over-year Headline CPI figure. Energy ought to have ticked up month-to-month as oil prices lifted from July to … Continue reading Tomorrow’s CPI Print. It Will Be There If Powell Wants It.
This week’s BTFP activity: The Bank Term Funding Program (BTFP, bail out/QE) had approximately $107.9 billion in outstanding loans as of Wednesday this week, up from $107.5 billion (+ $0.4 billion) a week ago. The “other credit extensions” line item of $133.8 billion includes the FDIC loans made to regional banks. This figure is down from $134.4 … Continue reading Weekly Update: Bank Term Funding Program
The Fed modestly trimmed its Treasury holdings while its Agency security holdings were unchanged for the week-ended September 6th. The Fed ought to get out of the Fed Funds rate manipulation game and should instead accelerate its QT program. Treasuries: The Fed’s Treasury security holdings declined by $18.6 billion for the week-ended September 6th and decreased … Continue reading The Fed’s Balance Sheet Reduction (QT) Update
My sense is that 2024 will be an up year insofar as bankruptcies are concerned so long as interest rates remain elevated (the 10-year Treasury yield sits at 4.27%). Q4 2023 could very well see an acceleration in bankruptcies as COVID-era fiscal benefits peel away. One such example is the end of Joe Biden's student … Continue reading August Commercial Chapter 11 Filings Up 54% Year-Over-Year
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