Wednesday, 24 June 2009

FOMC today...
An interesting piece today from the FT's Martin Wolf, pointing out that shareholder incentives and too big to fail increase systematic risk, not that he really has a solution, but at least he's more clear than others as to what the problem is.

Another "interesting" piece is the WSJ publishing their editorial from ?2004? saying that the Fed needed to raise rates to stop and inflation bubble, with the internal comment from Bernanke which says that inflation from input prices wasn't a concern at that time. They then go on to claim that they won the argument because of the asset price bubble that ensued. Frankly that shows them to be petulant and thick. Bernanke was precisely correct, we've not seen an inflation bubble!

L: 27% S:56% G: 83% N: -30% ~ $D 0% $G 0% $V 0% $P 0%

FOMC minutes tonight which the Raven is waiting for, he's getting long 10yr TNotes ahead of the meeting. The last couple of auctions have been well covered and he thinks that the market will have a favourable reaction to any comments of keeping rates lower for a longer period of time. By favourable here, he thinks UST rally as does SPX, but USD weaker, which isn't entirely logical.

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