Tag Archive: jerome powell

Fresh QE Has Arrived

The gold market rose to the highs of the day yesterday as markets reacted to commentary from Fed Chief Jerome Powell. Mr. Powell, at the annual NABE conference in Denver, said that the central bank will start expanding its balance sheet soon. He went on to state that the central bank also remains open to further rate cuts, citing risks to the global economy. Of note is the suggestion by Powell that this is in no way QE. He was quoted as saying “This is... Continue Reading

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Does the Fed Have Any Credibility Left?

The Federal Reserve has demonstrated that it is incapable of weaning the stock market off Fed-stimulus. This begs the question of whether the central bank has any credibility left as an inflation fighter and independent institution. The central bank began “treating” the market years ago. The Federal Reserve began with an initial round of QE, and when that didn’t work, it proceeded to provide additional injections in the form of QE2 and later QE3. Even that wasn’t enough, and the Fed was also forced to... Continue Reading

Fed Chief Jerome Powell Acknowledges Debt Problem

The U.S. is running massive deficits as the nation’s indebtedness continues to grow. Speaking at the Economic Club of Washington D.D., Fed Chairman Jerome Powell recently acknowledged the issue. In a piece by cnbc.com, Powell was quoted as saying “I’m very worried about it. From the Fed’s standpoint, we’re really looking at a business cycle length: that’s our frame of reference. The long-run fiscal, nonsustainability of the U.S. federal government isn’t really something that plays into the medium term that is relevant for our policy... Continue Reading

The War on Rates

The stock market has had another trying week, as the Dow Jones Industrial Average dropped some 900 points in a span of just two days. There are certainly a number of headwinds currently at play, including the ongoing war on trade, a stronger dollar and various geopolitical issues. Without question, however, the primary catalyst for this week’s stock selling appears to be the notion of higher interest rates. The Fed and its plans to normalize monetary policy have been the topic of significant debate in... Continue Reading

Is Further Downside in the Dollar on the Way?

It’s no secret that the dollar has been under pressure in recent months. The idea of rising deficits, ongoing relatively low interest rates and more aggressive monetary policies in other parts of the world have all played a role in the greenback’s slide. The dollar recently tried to rally as Fed Chairman Jerome Powell has not eased fears of three rate hikes this year and possibly a fourth. Higher rates could boost the dollar, as it could mean potentially higher returns for those holding dollars.... Continue Reading

No Easy Way Out

Now that new Fed Chairman Jerome Powell has taken the reigns, investors seem to be getting a sense that the central bank is not likely to deviate from its previous course under Janet Yellen. The central bank is still sticking with three possible rate hikes for this year, and the possibility of a fourth or perhaps larger hike are also on the table. The central bank now finds itself in a very difficult, if not impossible, situation. It has to attempt to control accelerating inflation... Continue Reading

More Fed Minutes – Same Story

Wednesday’s release of the highly anticipated Fed meeting minutes were essentially a non-event. Although no action is expected from the central bank until, next month, some investors did seem to be a bit nervous as the new Fed Chairman, Jerome Powell, takes the reigns. The central bank did stick with some similar language, as it suggested that it would on a path of gradual rate hikes. Of particular note, the Fed did raise its inflation expectations and stated that core personal consumption expenditures would rise... Continue Reading

Is Gold Waiting on the Fed?

Price action in gold recently has seen some significant whipsaws. Given the numerous bullish issues that could serve as the backdrop for a sustained rally higher, many investors may be wondering what might be driving the current selling pressure and volatile price action. Could it be the Fed? The Trump administration has been moving closer to a decision on who the next Fed Chair may be. Although current Chairwoman Janet Yellen may still be in the running, rumor has it that President Trump is leaning... Continue Reading

Will Tax Cuts Weigh on Gold?

The Senate has voted and passed a budget plan that could potentially pave the way for significant U.S. tax cuts. The House plans to take up the budget blueprint (approved by the Senate 51-49) as early as next week. A quick passage through the House could enable a tax cut plan to move forward expeditiously. The initial reaction being seen on Friday is dollar strength and gold weakness. That’s all it is, however, a knee-jerk reaction. Whether or not tax cuts might weigh on gold... Continue Reading