Will write soon an article on Infrastructure spending in the US. Need to do a bit of more research and it’s going to be released after FED takes on inflation in the US. Continue reading “Coming Up: Low Inflation and Infrastructure Spending in the US”
The core inflation rate is low at 1.6% missing the target of 2% with federal fund rate hovering around 2.5%. Hopefully, as Mr. Powell discussed, low inflation number is temporary. The Fed balance sheet is down to $3.9T and has both Mortgage Backed Securities and Treasuries. The low inflation is worrisome since the US economy is in top gear. Unemployment at the lowest levels with one of the highest wage growth in recent years, low core inflation (excluding energy and food prices) smells trouble.
Inflation is of two types: the supply side and the demand side. Printing excess money did not yield in much inflation and we will have to wait and see the next quarter for the demand side effect to structure out. Monthly treasury securities reduction is down to $15B from $30B from this month. With low inflation, pruning security reduction makes sense although according to experts treasury security reduction did not cause liquidity crunch. FED is right in waiting for another quarter to understand the direction of inflation for a more decisive action.
Attaching the link to the balance sheet normalization plan of the FED.
Implementation Note Issued May 1, 2019
My man Joe Biden recently kick started his Presidential bid campaign for 2020 with his first rally at Pittsburgh. I am impressed by his presidential campaign and it looks a lot of thought process has gone behind it. Guess which city in the US has been prominently highlighted on my blog. Of course Pittsburgh.
Coming up a special feature on the infrastructure story in the US. This month there would be a lot of vibrancy here. So stay tuned.
I had mentioned about the duration of bonds in my earlier article since I had read a report highlighting the duration of some US sovereign bonds to be 7. (Citation Needed). Duration is nothing but price sensitivity of bonds to interest rates. More on this at a later date.
Today there are a plethora of websites which cater to online education. Continue reading “DigiTal garAge: dO yOU Have ONE ?”
Reloading videos on my new YouTube channel so great if you would like to subscribe to the channel. Leave you with one of the best videos I ever shot at Pittsburgh music festival. A superlative visual and artistic spectacle. This week is the month of recap. Going forward will post a few videos which were part of my articles earlier. Also, plan to write an article on equity and debt markets in my signature style.
For debt, we will talk about the concept of duration since it’s going to part of the article. The world today as we know is loaded with debt. And are US equities akin to a toast with butter at both sides taking words of James Bevan, an asset manager from Europe? We will have to wait and watch as Master Nish unravels the mystery.
Reloading videos on my new YouTube channel so great if you would like to subscribe to the channel. Leave you with one of the best videos I ever shot at Pittsburgh music festival. A superlative visual and artistic spectacle.
One of the best documentaries for science aficionados, Cosmos: A SpaceTime Odyssey is much more than an enriching take on our Universe. Narrated by one the best-known scientist of our times, Neil deGrasse Tyson, it delves into many science topics apart from our Cosmos. I loved the Newton episode. Plan to watch it again. It’s hard to write a review of Cosmos, looking at the breath of topics this documentary covers. Its simply priceless…