You guys are cheating... Loosers : Joe Public Winners: Wall street Fed Res : Works for Wall Street Will it get worse, yes !!! From:http://bigpicture.typepad.com/ Unlike the spendthrifts here in the US, other Central Bankers around the world understand what the true definition of inflation is. Consider the following: The Reserve Bank of Australia hiked rates to an 11 year high (due to inflation concerns). And, Miller Tabak's Peter Boockvaar points out that, over the past month, Iceland, Romania and Mexico have raised interest. While the RBA move was expected, the Australian $ rallied to a 23 1/2 yr high vs the US$. All of this reminds me of that scene from Crocodile Dundee: That's not a Central Bank (pulls out 14 inch Bowie knife) Now THAT'S a Central bank!
The Fed is a BIG, FAT, FARGIN' LIAR!! M3 is still increasing at 14%. What in the hell does the US need in +14% money supply growth for? Then, they harp up and down, "no inflation... don't worry, be happy" WHAT? Do they think were totally STUPID? (Actually,they do.... and why not... we keep behaving like they are telling the truth.) Banks around the world are raising rates and citing "inflationary pressures". But none in the US? By continually citing "globalization" and "cheap foreign labor"... and by slipping us a big dose of inflation and currency debasement without our generally perceiving it, the Fed is trying to get away with something. What is it?
ON Average all countries that have weak currencies, have higher interest rates. Why, imported inflation. If you dont fight inflation you cant produce, cause prices keep going up. Your factories go bust. When headline inflation is say 4% and GDP is 4% then real GDP = 0%. Normally inflation is allows asset price's to rally, as an inflation hedge. So why arent the bonds moving higher. THATS the WEIRD thing, the 30yr should be much higher, hence forcing higher mortgage rates. Smells like stagflation...
Possibilities... 1. Conservative Yen carry trade buying. 2. Buying by Asian central banks mostly because they have so much of it that it's difficult to get it invested elsewhere in a timely fashion. 3. (My favorite) Fed is printing $USD, then via a covert operation through a European middle entity, Fed is buying treasuries. (Thus "monetizing" the debt without public knowledge.)