The Fed lost control

[oak333]

Central banks admit defeat.
------------------------------

"Past periods of very low rated have tended to coincide with
wars, financial crises, and breaks in the monetary system."

"The very low rates which central bankers thought would save
the world, have instead doomed the world."

https://www.zerohedge.com/news/2019-...s-admit-defeat

[oak333]

The myth of infallible central banks.
----------------------------------------

The markets are actually starting to behave normally, starting
to reflect fundamentals. Which fundamentals ? Trade war, slowing
economy in China, inverted yield curve, 16 trillion of negative yield
bonds, dangers of recession..

The myth of infallible central banks is deeply embedded. Do not fight
the Fed...

But central banks have limits, political, legal and others. There are already
doubts about the independence of the Fed.

How this myth is coming unwound in the next weeks is really important.

https://www.realvision.com/tv/shows/...e-central-bank

[oak333]

European central bankers dissented over the QE of Mario Draghi, ECB.
This includes the central bankers of Germany, France, and Netherlands.

https://www.zerohedge.com/geopolitic...sented-over-qe

My note: these are really unprecedented times. Better beware !

[oak333]

Martin Armstrong: the troubles in the interest rates has just started.

---the fed lost control of short term interest rates
---the administration can jawbone for lower interest rates.
The markets show something else.
---the repo rates hold the economy together
---the credit risk is serious. This time is not mortgage
based securities (2008-2009) but negative yield bonds,
which have destroyed the bond markets
---the financial system cannot just work with negative yields
and that has contributed to liquidity crisis in the repo markets
https://www.armstrongeconomics.com/m...tting-started/

[oak333]

The Fed pumped today 105 billion $ into the repo market.

It is the first time after a decade that the Fed has to take
steps to relieve pressure in the money markets.

https://markets.businessinsider.com/...9-9-1028549481

[silverone]

The Fed pumped today 105 billion $ into the repo market.

It is the first time after a decade that the Fed has to take
steps to relieve pressure in the money markets.

https://markets.businessinsider.com/...9-9-1028549481

it's probably nothing... can't they just print more Money?

[silverone]

https://www.cnbc.com/2019/10/08/powe...heet-soon.html

[oak333]

Ownership of central banks
------------------------------

Some central banks are owned by the public sector, like in England.
Some central banks are owned by private companies, like Italy.
Most of the central banks have a mixture of both public and private
ownership.

Ownership in a central bank it is not equal to control. If you own
shares in a company, does not mean that you exercise much control.

Note how many banks have been nationalized. Last one is Austria in 2010.

https://bankunderground.co.uk/2019/1...central-banks/

[oak333]

Central banks have started to panic. ECB and the Fed come back to QE.

McKinsey Co: Half of the world banks may be not strong enough to withstand
a crisis.

https://www.zerohedge.com/news/2019-...ks-begin-panic

[oak333]

Central bankers are not sure what to believe anymore.
-------------------------------------------------------------

Central bankers and economic policy makers convened in Washington
for the annual meeting of IMF, IIF, and World Bank.

Three main themes:
1) what are the long term implications of negative interest rates
2) how disruptive is the new technology (crypto currencies, mobile payments..)
3) what does actually greening of the financial system mean in practice ?
It it about the effects of the climate change on the financial system.....and it
was the biggest subject

https://www.zerohedge.com/economics/...elieve-anymore