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Only a Computer Could Be So Dumb
Daily Rap 04-23-2013
Overnight markets were strong, with Europe gaining 2-3% on the back of some rather large moves towards lower rates in European bond markets. When I look at the basket cases of government debt in Europe I have to shake my head at the yields, but on the other hand, when you realize that Japan and the U.S. are also out of control and have ridiculously low yields, I suppose it makes sense. After all, the only difference between Europe and the U.S. or Japan is that Draghi has yet to use his OMTs.
In any case, given the upside free-for-all in European debt and equity markets, stocks here wasted no time joining the party, gaining 1% in the first couple of hours as all prior sins were forgiven. For what it is worth, I covered my small equipment...more
Last year's posts for Ask Fleck
Q: Hi Fleck,
Some interesting comments from former Chairman Volcker:
Central banks, including the Fed, could eventually inflict more harm by "what they're doing with their portfolio to save the world economy,"...
"Central banks are no longer central banks,...
I think it gets dangerous when they lose sight of the basic function of the central bank..."
Moreover, he says the more central banks become key players in financial markets, the more dangerous their actions can become...
"Once you have the idea that a little bit of inflation is a good thing, it is very hard to get rid of it,"...
"The Federal Reserve is the world's largest financial intermediary,"...
No surprise to Ask Fleck readers, but this is the first criticism I've seen from a (former) central bank chair. I am sure we'll hear from Maestro Greenspan after this global insanity results in yet another major market dislocation.
Fleck: Volcker has voiced concerns in the past, but he really hasn't stood up and yelled loudly despite horrendous errors at the Fed. Kinda disappointing really.
Q: Fleck...thought your "Fleckies" especially the newer members of your fan club might really enjoy this 3rd segment of Jim Puplava's FinancialSense weekend interview. He dedicates a whole hour to it and his take on Goldman is "precious" to say the least. Then to add icing to the cake, he interviews Kathy Derbes. I found it interesting even though I have followed you for awhile.
Fleck: Thanks, but please (you're not alone) don't refer to readers as "Fleckies " or fans. I feel it is slightly demeaning to all of us. People here are just trying to navigate the ridiculous financial world we live in. I'm not picking on you, this has happened before, and I should have said something.
more Ask Fleck...