The Fed knew about the housing bubble before it burst but lied and said they didn't: Bill HR 1424 to buy bad paper (eventually called TARP) was introduced in March 9, 2007, before there began to be bad commercial paper from private subprime RE loans, in August. I have published on two other ...
more The Fed knew about the housing bubble before it burst but lied and said they didn't: Bill HR 1424 to buy bad paper (eventually called TARP) was introduced in March 9, 2007, before there began to be bad commercial paper from private subprime RE loans, in August. I have published on two other prominent financial websites, Seekingalpha.com (as Gary A) and at Businessinsider.com. I muckrake the banking system and found premeditated causes for the housing bubble and subsequent meltdown. I am married with 4 grown children.
Specialties: Impacts of politics on the economy, interpreting economists, writing about the negative impact of some aspects of globalization and pros and cons of the new normal. I don't like tariff wars. Email bgamall at gmail
less
Latest Comments
Fed Makes Same Mistake As It Did In 1927
Now we have long bonds as collateral for derivatives. There were derivatives of a sort in the Great Depression but collateral was more likely a commodity or gold. With long bonds in big demand, the long end of the curve is flat, and banks won't lend as much with no chance of a better interest rate.
Dow Jones Industrial Average Slumps 65 Points After Interest Rate News
Dimon said banks would not benefit from a raise in interest rates that much because they would have to pay more interest. I am surprised they declined in price. Makes no sense.
This Is What Yellen Said About Negative Rates Coming To The U.S.
Well, the banks were exposed for manipulating bond auctions, according to a lawsuit not yet settled. But if that is the case, then they are exposed in the scheme of helping yields go up artificially. While that is a noble goal, the way they went about it appears fraudulent, pending settlement of the case.
But maybe they are just giving up and are wading into the dark murky waters inhabited by Summers and Roubini. I would rather see long bonds banned from use as derivatives collateral. But that will not happen so Summers and Roubini have their nets waiting, like Venus Flytraps.
The Fed Scares Everyone About Treasuries From Time To Time. Is It A Scam?
Author note: According to Bloomberg, there is a potential scam pushing bond prices lower and yields higher. The yields should be lower, and there is more demand for bonds than the bankers are allowing, according to the lawsuit: www.bloomberg.com/.../primary-dealers-rigged-treasury-auctions-investor-lawsuit-says
Everyone Said Treasury Bond Yields Would Go Up After QE Ended
Author note: Even with banks artificially goosing yields based on the new auction lawsuit as reported by Bloomberg, yields on long bonds are low and actually should be LOWER.
The Republic Of The Congo Could Be The Next Big Story Due To Russia
I agree. Politics is a joke now. Both parties are globalists, face it. The last president of a sovereign nation was JFK in my opinion. So, while the Democrats prefer less war they are bought out in other ways by the globalists. Sarah Palin and Hillary Clinton have both been sponsored by Lady Lynn Rothschild, so that should tell us everything we want to know about this world order.
Liftoff: Empirical Assessment Of The Implications For The Dollar
So, what if the Fed keeps raising short rates and long rates do not respond, due to their demand as collateral in the massive derivatives markets? They will have to back off, or create an inverted yield curve, possibly. How would that impact the dollar?
The Republic Of The Congo Could Be The Next Big Story Due To Russia
Yes, and it is amazing that these nations have been so slow to react. They should have stopped trusting the United States the day Richard Cheney became co president.
Wednesday: Wages (Or Lack Thereof) Are Killing This Country
Shared this. Truth is, the long bond is hostage to artificial demand for collateral in derivatives deals. As long as the long bond is hostage, the Fed really has little to do to fix things for main street.
U.S. 2-Year Treasury Yield Rises To New 4-Year High
10 year is used as collateral for derivatives deals, and is in massive demand. The Fed should raise rates but until the 10 year is freed from use as collateral, it will likely hold onto low yield and high price.