Quantitative Easing

Bond-Buying Chaos Is Spinning Out of Control

20140616_Bonds-Q-BW

A few weeks ago, the man formerly known as the Bond King, Bill Gross, tweeted that shorting German bunds would be the trade of the century.

I was gratified to see that he was reading my mind, as readers of my Credit Strategist newsletter already know.

As a result of a massive bond-buying program by the European Central Bank (ECB), the yields not only on German bunds but on all European debt had plunged to ridiculously low levels.

Here's what you need to know...

How to Play the Japanese Stock Market Euphoria

Japanese stock market

U.S. market indexes plunged yesterday (Wednesday) and took the Japanese stock market with them.

The Nikkei 225, a Japanese stock market index tracking 225 Japanese blue-chips, fell 1.4% today. This was the day after a broad sell-off in the U.S. stock market. This was a blip in what will be a larger rally.

Japan is presenting an opportunity, but this recent sell-off shows that investors need to be discriminant in buying Japanese stock...

The Truth Behind Central Banks' Machinations

central bank

Central bankers disguise themselves as friendly shepherds. But really it's more of a "wolf guarding the henhouse" situation...

You see, we've been experiencing deflation, not inflation...on a global scale. Why aren't prices rising? Why aren't wages rising? Why is global demand so lackluster?

Well, the answer has to do with central bankers' and how they treat your money...

It's Not Time to Sell Everything… Yet

The Fed One of my favorite lines is "I'm not the kind of guy to say I told you so – but if I was, I'd sure be saying it now." As far as saying "I told you so," back in the summer of 2008, in my "Friday Night Illumination" emails to my banker and trader friends, […]

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Why the European Central Bank's Massive Economic Experiment Will Fail

Eurozone conflict

Last week, the European Central Bank's turn finally came to announce large scale quantitative easing.

As the continent witnesses a battle between deflation and attempts at inflation, will it finally be enough?

Europe is following in the footsteps of the United States, hoping for similar "successful" results.

Instead, it's likely to fall somewhere between the U.S. and Japan.

From the Land of the Rising Sun there is precedent, but it's a forewarning.

Here's the story...

FOMC Meeting Today: A Tale of Two QEs

FOMC Meeting Today

The Federal Open Market Committee (FOMC) Meeting today marks 2015's inaugural meeting of the U.S. Federal Reserve's monetary policy makers.

It's only been a month since the last meeting convened. But a lot has changed. It's following big stories in the way of global central, particularly from the European Central Bank.

Here's how this QE story will play out, and why today's FOMC meeting will just be noise in a much more troubling outlook for central banking...

ECB QE Points to These Profit Plays

ECB QE

ECB QE and EU LTRO for Dummies: As soon as you read this explanation, comprehensible to even the dumbest of the dumb, you'll be set to trade initials.

We made 382% gains trading these initials. And there's more: Once we closed out, we re-entered.. and now we're up 180%.

Here's how to make real, easy money from the world's biggest economic experiment...

Protect Your Money From the QE Delusion

quantitative easing

While this week's announcement of a massive new QE program by the European Central Bank (ECB) was the worst kept secret in the world, it may not produce the results that everyone expects.

For one thing, while the immediate reaction was to push European interest rates lower, recent experience in the US shows that QE results in higher rates.

And while everyone is talking about deflation - and Europe is definitely experiencing deflation - the US is still experiencing inflation that could lead the Fed to start raising rates by summertime.

So before getting too carried away with celebrating another major central bank opening up the printing presses, investors should take a serious look at the facts and then decide how to play the markets.

Why QE Doesn't Work

why QE doen't work

Quantitative easing doesn't work.

And that can be a tough pill to swallow. Especially for the world's central bankers who are only more aggressively employing QE strategies to bring an end to their economic woes.

Here's why they're doing it anyway, and why it won't bear fruit...

The World Slides Deeper into the Dangerous "Helicopter Money" Delusion

global marketplace

If it seems to you that central banks and government leaders have run out of ideas, you're not totally wrong.

Indeed, the latest move by Japan smacks of pure desperation, and it might seem silly if it wasn't already an idea that's been floated before.

In fact, we may yet have the chance to see "helicopter money" and its effects after all.

The whole thing is so sad, it's almost funny. Almost.

But like too many crazy ideas, desperate people may be inclined to try anything...

Here's What Rising Rates Really Do to Your Shares

rising rates

There is a lot of lip service being paid to the upcoming stock market crash that we're supposed to expect once the Federal Reserve starts raising rates.

Every time we get close to a regularly scheduled Federal Reserve statement, financial pundits pontificate about the nuances of what the Fed Chair might say, not say, or imply.

It's like clockwork.

But one theme remains constant: any tightening of the Fed's easy monetary policies will spell impending doom for the easy-money-addicted stock market.

The only problem, though, is that historical facts just don't support the fear. In fact, there are opportunities for investment out there no matter what rates do... Full Story

Fed Policy Failures Leave $10.8 Trillion Under the Mattress

fed policy

Despite billions in bond-buying "quantitative easing" and near-zero interest rates courtesy of recent Fed policy, Americans have stashed $1.8 trillion in low-yield accounts since the QE program started in 2008.

It's a failed stimulative policy that has left a shocking $10.8 trillion on the sidelines. But when it comes to investing in stocks in particular, the news gets even worse.

This trend is truly ominous…

Janet Yellen Sticks to the Script (Here's What It Means for Investors)

Janet_Yellen_Headshot

Janet Yellen made her debut before Congress Tuesday as the new head of the Fed...

And just like they did for her predecessors, the markets hung on every single word.

Except in this case, nobody (and I mean nobody) expected any major fireworks. What they were looking for instead was a confirmation that it would be "business as usual."

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FOMC Meeting Today: How the Taper Is Affecting Markets

Ben Bernanke Speaks At The National Press Club

The Federal Reserve went forward with its taper plans yesterday, announcing it would reduce its bond-buying by $10 billion per month. But that is no guarantee the Fed will continue to taper, especially if the economy falters. And now that the Fed has a new chief in Janet Yellen,

we could be in for some surprises this year...

What the Fed Taper Means for Markets and Your Money

I didn't think it would happen, but Fed Chairman Ben Bernanke up and did "it" a few minutes ago.

He announced the "Fed taper" - the Fed will cut its bond buying by $10 billion a month (to $75 billion) beginning in January.

I think there are a few points to consider about Bernanke's move. I want talk briefly about those, and then highlight what this news of a Fed taper means for your money.

To continue reading, please click here...

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