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Fed Watch

  • Fed Watch
October 22

As the complexity of the ongoing legislative negotiations continue, the chances for Lael Brainerd ascending to Powell’s chairmanship is probably rising. We think the Biden Administration would prefer to keep Powell given the President’s nature, but the progressive wing of the party has had several...

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  • Fed Watch
October 15

All Eyes On Coming November Meeting, Ethics Issues Bring Up Interesting Questions

We all know there are a lot of Federal Reserve critics and we could all probably parrot the line of reasoning they use. Such a powerful institution will inevitably have critics; however, to be perfectly honest, much of the criticism is anachronistic and misses a lot of developments and changes...

  • Fed Watch
October 8

Speculation Over Powell’s Future, Fed Likely To Taper Despite Disappointing Jobs Number

All eyes were on the job report this morning since the Fed has telegraphed publicly that the pace and breadth of recovery in the labor market would be a key indicator to help determine its timing on policy changes. The jobs report was indeed disappointing, but Powell prepared markets for...

  • Fed Watch
October 1

The Most Dangerous Man? Rosengren and Kaplan To Resign Over Trading

Elizabeth Warren called Chairman Jay Powell the most dangerous man in America. We suspect that history will judge Powell more in the fashion of Daniel Ellsberg (who also received that title) than Al Capone. We suspect Warren’s attempts to torpedo the renomination will be unsuccessful and that isn’t changed by...

  • Fed Watch
September 24

Powell Gives Additional Coloring on Tapering Schedule and Addresses Evergrande Risk

The Federal Open Market Committee meeting took place in the shadow of one of the most vicious market selloffs of 2021 which occurred Monday. While the market sell-off was probably mostly triggered by the insolvency of Evergrande, the Chinese property development giant, the market is also in a seasonally challenging...

  • Fed Watch
September 17

Powell To Review Ethics Codes, Next Meeting To Illuminate Tapering Plans

The Federal Reserve Chairman himself has become embroiled in the ethics concerns we reported on last week caused by the admission of Bank Presidents Kaplan and Rosengren that they had traded in securities that would have likely been affected by the Fed’s purchasing activities. It has now come out that...

  • Fed Watch
September 10

Beige Book Shows Slowing Growth, Hot Water Over Trading

The Fed released its Beige Book, which is published 8 times each year. The document is primarily anecdotal information on economic conditions by district. Given, the different specialization in regional economies it is a nuanced look at the US economy at a more granular level and we always find it...

  • Fed Watch
September 3

Soft August Data Likely Pushes Back Taper; Progressives Take Aim At Powell

The headline from 30,000 feet about Jay Powell’s virtual Jackson Hole speech was that the Significant Further Progress (SFP) criteria had been met for inflation but had not yet been attained in the labor market. Several Fed officials, including Lael Brainerd, had commented they would need to see more employment...

  • Fed Watch
August 27

Powell Announces Fed Will Begin Tapering By End Of Year

The long-awaited Jackson Hole Summit has arrived. Chairman Powell gave his speech at 10 am EST on Friday and announced that the Central Bank was likely to begin tapering before the year ends while keeping his options open due to the Delta variant. The symposium was held virtually for the...

  • Fed Watch
August 20

Fed Minutes Provide Rough Contours of Tapering Discussion But Very Little Detail

The latest minutes of the Federal Reserve Open Market Committee came out earlier this week. Despite scant detail, there were indications that tapering would be announced and potentially even begin before the end of 2021. The minutes were largely backward-looking, though, and reflected a meeting that occurred before the extent...

  • Fed Watch
August 13

Fed Policy Debate In Full Swing, Climate Change Issue Re-Emerges

At the end of June in 2004, Alan Greenspan was Chairman of the Federal Reserve and was nearing the end of a long and illustrious tenure. At that months’ meeting of the FOMC, the committee raised the federal funds rate 25 bps, from 1% to 1.25%. For the next sixteen...

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