Questions as to exactly why the Fed governors changed their minds so swiftly.
Bloombergs John Authers erkänner att han hade fel när han inför onsdagens besked varnade för hökaktiga tongångar från den amerikanska centralbanken.
Han pekar på marknadsreaktionerna som bevis för att han inte var ensam om att bli tagen på sängen.
”Jag förväntade mig inte detta eftersom jag tyckte det vore en dålig idé. Den här utvecklingen oroar mig”
It’s never fun to admit that you’ve been wrong, but I have to do so now.
High mortgage rates have caused activity to dry up, and also made it far harder to sell new houses. That affects the economics of construction. How serious is this problem? According to census data going back more than 60 years, new house prices have never before fallen as much as in the last 12 month
Overall wage growth remains above 5%.
The economy has been given a nice boost (and the proximity of an election may or may not have something to do with it)
It’s possible, to quote Steven Blitz of TSLombard, that “recession isn’t an option.” Unlike Paul Volcker’s time, it looks like this Fed is going to try to avoid a dose of serious unemployment if it possibly can, even at the risk of allowing inflation to take hold once more.
It’s also possible that the Fed thinks at this point that it needs to help out those harmed by the collapse of long bond prices. That briefly sparked a full-on crisis for US regional banks earlier this year.
John Authers Bloomberg 15 December 2023
The Great Monetary Pivot of 2024
https://englundmacro.blogspot.com/2023/12/the-great-monetary-pivot-of-2024.html
Kommentarer