tag:blogger.com,1999:blog-6616959642391988608.post16780762682513076..comments2024-03-28T00:18:25.641-07:00Comments on Calafia Beach Pundit: Monetary policy update and overall outlook summaryScott Grannishttp://www.blogger.com/profile/14028519647946868684noreply@blogger.comBlogger10125tag:blogger.com,1999:blog-6616959642391988608.post-90951003477644233722011-03-20T09:57:01.439-07:002011-03-20T09:57:01.439-07:00I do think long rates will rise significantly, and...I do think long rates will rise significantly, and that will probably happen as signs of inflation increase and the Fed starts tightening. But the rise in rates won't be caused by Fed bond sales, just as its bond purchases haven't caused bond yields to fall. The rise in rates will be driven by an increased inflation premium and by expectations of much higher short-term rates to come.Scott Grannishttps://www.blogger.com/profile/14028519647946868684noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-29880045348207335182011-03-20T09:37:56.107-07:002011-03-20T09:37:56.107-07:00as usual, great analysis scott.
i was with you up...as usual, great analysis scott.<br /><br />i was with you up to the point in the analysis when it might be interesting to consider the effect of the fed's reversing qe and decreasing the size of its b/s...assuming it ever decides to.<br /><br />don't you see long rates going up significantly once the fed is a net seller of treasuries?Christian S. Herzeca, Esq.https://www.blogger.com/profile/09913237226503475709noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-6049559982252130592011-03-20T06:52:43.384-07:002011-03-20T06:52:43.384-07:00PS: The US has been enduring a century of inflatio...PS: The US has been enduring a century of inflation mostly at the hands of long-term fiscal and monetary policies that are consistently inflationary -- I doubt that society has the will or even the power to reverse that apparent feature of modern democracy -- more at:<br /><br />http://wjmc.blogspot.com/2011/03/century-of-inflation.html<br /><br />Thank you for the opportunity to comment...McKibbinUSAhttps://www.blogger.com/profile/10545798495680527622noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-79816192354597112682011-03-20T06:50:53.291-07:002011-03-20T06:50:53.291-07:00This comment has been removed by the author.McKibbinUSAhttps://www.blogger.com/profile/10545798495680527622noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-64583420554681329412011-03-20T06:47:46.047-07:002011-03-20T06:47:46.047-07:00Scott, to your point above, I agree that recovery ...Scott, to your point above, I agree that recovery in the US is well underway, at least in the private sector -- the bigger question looming is how to handle the impending public sector default on bonds and entitlements (which will occur one way or another, either through austerity, inflation, or outright default) -- my gut is telling me that a public sector default is already built into current McKibbinUSAhttps://www.blogger.com/profile/10545798495680527622noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-75177828587017799462011-03-19T14:55:17.111-07:002011-03-19T14:55:17.111-07:00Bill: No, I don't think Japan and the Middle E...Bill: No, I don't think Japan and the Middle East will push the world into recession. Lots of reasons why: The forces of recovery are well in place. The world has had plenty of time to adjust to the problems which led to the last recession. Companies are more profitable and workers are more productive. Monetary policy is many years away from posing a threat to growth. Fiscal policy is going Scott Grannishttps://www.blogger.com/profile/14028519647946868684noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-26588006312296248332011-03-19T14:33:05.885-07:002011-03-19T14:33:05.885-07:00Nice to see your back. Love your site and commenta...Nice to see your back. Love your site and commentary. You are a very clever dude indeed and I enjoy your timely comments. You are definatly underpaid. Keep up the great work.TradingStrategyLetter - Weekly Summaryhttps://www.blogger.com/profile/06430136667577107255noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-70502515663253129592011-03-19T14:19:36.342-07:002011-03-19T14:19:36.342-07:00BTW, an excellent Ramesh Ponnuru piece on the cras...BTW, an excellent Ramesh Ponnuru piece on the crash of 2008 is up on the National Review website. I<br /><br />Ramesh Ponnuru relies heavily on the views of quasi-monetarists like David Beckworth, Josh Hendrickson and Scott Sumner. <br /><br />I dearly hope the right-wing takes seriously this new thinking about QE, from a right-wing source. Somehow the right-wing has knee-jerked itself into aBenjamin Colehttps://www.blogger.com/profile/14001038338873263877noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-16351860195888572202011-03-19T14:05:31.267-07:002011-03-19T14:05:31.267-07:00Excellent wrap-up by Scott Grannis.
If I thought ...Excellent wrap-up by Scott Grannis.<br /><br />If I thought the Fed was aggressive before--and I did not--I would recalibrate my thinking now. The Libya-Japan crises suggest QE2 be maintained, and even expanded.<br /><br />Now is not the time to fight inflation. Japan has been fighting inflation for 20 years--very successfully. The only problem is that asset values fell 80 percent in that Benjamin Colehttps://www.blogger.com/profile/14001038338873263877noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-24477732960667446612011-03-19T13:25:02.126-07:002011-03-19T13:25:02.126-07:00Scott,
Do you think the Japan disaster and unrest...Scott,<br /><br />Do you think the Japan disaster and unrest in the Middle East will push the world into recession?Billhttps://www.blogger.com/profile/06910619601367464068noreply@blogger.com