Posts filed under “Taxes and Policy”

Interest Rates Aren’t Going Anywhere . . .


Source: BAML, Fiscal Times

 

 

I have been fairly agnostic on several issues related to where interest rates are heading. It has never been my job to forecast where the 10-year yield will be in six months. Not predicting and not caring are two very different things, however. Rates matter a great deal — to investors, to the economy and most of all to debtors of every kind.

You would be hard-pressed to find anyone in finance who would ever admit to believing that rates don’t matter. Despite the importance of bond yields and borrowing costs, few seem to have any idea how to analyze them in a way that provides a helpful conclusion.

And while many are quick to point out how disruptive the Federal Reserve programs of quantitative easing and zero-interest rates have been to stock and bond prices, that’s a terrible excuse. One would think that something so big, so contentious and so transparent would be easy to insert into traditional economic models. But no.

As it turns out, most of the economic community on Wall Street has gotten this terribly wrong. Some have disagreed, such as Jeff Gundlach and Gary Shilling (see this and this) but they are notable exceptions.

 There are many indicators that keep suggesting that our lowlowlow rate world is going to stay this way for a long time. Some of these are turning out to be more significant than many had expected.

First . . .

 

Continues here

 

Category: Credit, Federal Reserve, Fixed Income/Interest Rates, Psychology, Really, really bad calls, Taxes and Policy

More Long Bonds Now!

Every once in a while, there is a way to resolve a host of problems that is so obvious it gets overlooked. With that in mind, and in light of yesterday’s Federal Open Market Committee meeting and the reaction that followed, let’s have a look at four big problems: crumbling U.S. infrastructure; federal budget deficits;  normalizing…Read More

Category: Really, really bad calls, Taxes and Policy

Time for Janet Yellen to Go On the Ellen DeGeneres Show

This week, the NBC/Wall Street Journal poll on presidential contenders for 2016 came out. It was the usual sort of thing: Favorable versus unfavorable ratings for the candidates: Democrats like Hillary; Republicans like Jeb (but not as much as Dems like Hillary); no one likes Chris Christie or Donald Trump. But you might have missed a fascinating tidbit buried…Read More

Category: Federal Reserve, Really, really bad calls, Taxes and Policy

John Oliver on Infrastructure

America’s crumbling infrastructure: It’s not a sexy problem, but it is a scary one.

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Category: Economy, Humor, Really, really bad calls, Taxes and Policy, Video

Fed Gives Congress Room to Shirk Resposibility

One of my favorite thought experiments is the careful-what-you-wish-for scenario. I was reminded of its utility during Federal Reserve chief Janet Yellen’s Congressional testimony the other day. Consider the critique of the Fed by some members of Congress. As the New York Times described it, the three-hour hearing was “testy” as “Republicans on the House Financial…Read More

Category: Bailouts, Politics, Really, really bad calls, Taxes and Policy

Does front-loading taxation increase savings?

Category: Taxes and Policy, Think Tank

John Oliver on Big Tobacco

Thanks to tobacco industry regulations and marketing restrictions in the US, smoking rates have dropped dramatically. John Oliver explains how tobacco companies are keeping their business strong overseas.

 

Last Week Tonight with John Oliver: Tobacco

 

 

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Category: Humor, Science, Taxes and Policy, Video

The Shrinking American Middle Class

click for interactive infographic Source: The Upshot

Category: Data Analysis, Economy, Taxes and Policy, Wages & Income

There’s Never Been a Better Time to Be Rich . . .

Source: MoJo

Category: Politics, Taxes and Policy, Wages & Income

The Where-To-Be-Born Index

Source: The Economist

Category: Data Analysis, Economy, Psychology, Taxes and Policy