The Mess That Greenspan Made - Part 6

The Worrying Side Effects of BZIRP

The Financial Times takes a look at the blossoming of Below Zero Interest Rate Policy in Europe (aka BZIRP, where investors pay to lend money to borrowers) while wondering where it’s all headed in the short-term (e.g., currency wars) and long-term (maybe much worse).

The soothing British accents notwithstanding, this strikes me as another example of the relative calm that is experienced when venturing further out into uncharted territory (e.g., like when there was a commonly held belief that U.S. home prices never decline).

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Tuesday Morning Links

MUST READS
Chinese home prices fall for ninth month – BBC
Negative rates to shake up financial system, say experts – FT
EU hangs tough, waiting for Greece to bend as euro wilts – Reuters
Greek Euro Exit Risk Increases as EU Delivers Ultimatum – Bloomberg
“The Idea Was to Create a Modern Gold Standard” – Slack Wire
Ukraine cease-fire ignored around key railway hub – USA Today
Russia Creates Its Own Payment System – Ian Welsh
Line of waiting ships grows as ports shut down – LA Times
Earth Calling the Financial Sector – Project Syndicate
GOP Congress On The Verge Of A Meltdown – Forbes
Obama: The Vox Conversation – Vox
Get Ready for $10 Oil – Bloomberg

MARKETS/INVESTING
Stocks: 4 things to know before the open – CNN/Money
Physics in finance: Trading at the speed of light – Nature
Oil rises to $62, near 2015 high as Mideast risks support – Reuters
Chinese stocks keep up their winning streak ahead of holiday – MarketWatch
Treasuries Rise as Impasse Over Greek Debt Boosts Safety Demand – Bloomberg
Gold snaps 3-day rally after Greece talks collapse, low China demand – Reuters
CFTC: Gold Market Sees Biggest Decline In Spec Longs Since November – Kitco
Is China hiding its central bank gold in its commercial banks? – Mineweb
Koos Jansen vs WGC/GFMS/CPM Update – BullionStar
Gold on a Roll and It Could Go Higher – CNBC

ECONOMY/WORLD/HOUSING/BANKING
Measuring Underground Economy Can Be Done – St. Louis Fed
What’s next for Japan’s economy after the latest recession – AP
UK inflation rate falls to record low of 0.3% in January – BBC
German Investor Confidence Rises to One-Year High Before QE – Bloomberg
Hollande’s flagship economic reform law faces parliamentary test – Reuters
China’s economy to grow about 7 percent this year: central bank official – Reuters
Pets becoming victims of San Francisco housing crisis – ABC 7 News
The Second Time Around: Helping Americans Re-Enter the Housing Market – MReport
Rand Paul Draws Liberal Fire As The Left Discovers It Loves The Fed – Forbes
Cleveland Fed President Mester: June Rate Increase Is ‘Viable Option – WSJ

 

Our Possible Futures

From time to time I’ve wondered how Mankind could possibly evolve into anything like what you see on just about any episode of Star Trek given how we seem to be reversing course in many ways in recent years. Others are apparently wondering about the same thing.

From the archive at The Cagle Post.

Friday Morning Links

MUST READS
Eurozone economy sees growth pick up – BBC
Euro zone economy accelerates thanks to German ‘thunderbolt’ – Reuters
Brent crude oil price tops $60 as US supply plummets – City A.M.
Greece will do ‘whatever it can’ to reach deal with EU – Reuters
Hopes for Greek debt deal rise but no quick solutions – AP
Ukraine’s new bail-out: The austerity to come – Economist
Putin tried to delay ceasefire so rebels could capture Debaltseve – Guardian
Putin’s High Tolerance for Pain and Europe’s Reluctance to Inflict It – Bloomberg
Where Have All the Construction Workers Gone? – The Atlantic
Are We Becoming a Part-Time Economy? – Atlanta Fed
Here’s a $9 Trillion Question – Bloomberg
Worst Western Drought in 1,000 Years – NatGeo

MARKETS/INVESTING
Global stocks higher on Greek progress, eurozone data – AP
Stocks near a bubble, but don’t panic — yet – MarketWatch
GMO: Stockpicking Isn’t Dead, It Just Smelled Funny Last Year – Barron’s
Bulls may be getting their second wind in market marathon – MarketWatch
Bondholders to Homebuyers Suffer as Treasury Yields Advance – Bloomberg
Gold edges up on dollar but heads for third weekly drop – Reuters
25% of physical gold buyers are crazy, metals executive says – CNN/Money
India world’s largest gold ‘consumer’; China has biggest total demand – Mineweb
Swiss Bank Says Investors Favor Gold Amid Charges on Cash – Bloomberg
Chinese gold demand discrepancy explained? – Lawrie on Gold

ECONOMY/WORLD/HOUSING/BANKING
When the Growth Model Fails – NY Times
Aggregate Demand’s Shocking Lack of ‘Demand’ – Alhambra Partners
The Global Economy’s Chinese Headwinds – Project Syndicate
Too Many Car Factories in China? – Bloomberg
U.K. Housing Defies Drop in London’s Priciest Districts – Bloomberg
The undeniable truth about Vancouver’s housing market – The Speaker
How Mortgage Fraud Made the Financial Crisis Worse – NY Times
Manhattan Luxury Condos Turn to High-End Rentals in Days – Bloomberg
What a Central Bank Can, and Can’t, Do About Government Debt – WSJ
Richard Fisher’s Next Job? – NY Sun

 
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