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Does this make you feel confident? 1/
Meanwhile, I understand why the Fed felt it had to fire its bazooka. But really hard to believe that interest rate cuts will do much when consumer demand is collapsing; QE might help with liquidity, though even there I'm not sure 2/
We really need fiscal policy. But last I heard, the Senate hasn't even scheduled a vote on the (modest and vastly inadequate) House bill 3/
Futures markets not reassured, although the markets have been so manic-depressive God knows how they will look in a few hours 4/
Stock futures just hit limit down. PS: I know something about this 4/
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Paul Krugman
@paulkrugman
I've been getting some questions from readers wondering about the cost of the not-a-stimulus (it's actually disaster relief) package. "Where's the $2 trillion coming from? Thin air?" Basically, yes 1/
We went through this argument back in 2008-2009, when many people (including some who should have known better) worried that government borrowing was going to "crowd out" private investment. There are times when that happens, but this isn't one of them 2/
In the most immediate sense, the govt is going to borrow the money — and its borrowing costs are near record lows, despite the surging deficit (those recent wiggles are about financial disruption, which the Fed has mostly calmed) 3/
Read 5 tweets
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Paul Krugman
@paulkrugman
Aha. Monmouth director of polling says what I was thinking: you expect some rally-around-the-flag in a crisis, and Trump's approval bump is exceptionally small 1/
Foreign leaders have experienced much bigger surges 2/ reuters.com/article/us-hea…
Predictions are hard, especially about the future, but as the death toll rises and the economic impact hits home, this bump will probably become a forgotten blip 3/
Read 3 tweets
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Paul Krugman
@paulkrugman
Not a surprise, but still an astonishing number. Bear in mind that not everyone is eligible for UI, so true job losses bigger than 3 million — in one week 1/ cnbc.com/2020/03/26/wee…
Bear in mind that at the absolute worst of the Great Recession we were losing 800,000 jobs *per month*. So this is at least an order of magnitude worse 2/
Will the stimulus bill help? Not much — because it really isn't stimulus, nor should it be. This isn't a conventional recession, it's more like a medically induced coma; we want workers to stay home, and give them disaster relief, which is what the bill mostly does 3/
Read 3 tweets

Related threads

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Tuomas Malinen
@mtmalinen
Many are calling for a rate cut on the #Fed, but there's very little central banks can do at this point.

A thread on, why #centralbanks will be unable to stop any repercussions from the #CoronavirusOutbreak .

We naturally start with the balance sheets. 👇1/12
Which are just massive.

The very role of any easing (quantitative or normal) is to push interest rates down.

In addition, it was the purpose of QE -programs to also create a "wealth effect", by increasing the values of financial assets and making people feel "rich". 2/
We detailed the channels of effects of QE programs in the Q-Review 1/2018. 👉gnseconomics.com/wp-content/upl…

Even today, the effects are not understood by all, but they depend heavily on the ability of the programs to push down (converge) the yields of bonds in different classes. 👇 2/
Read 13 tweets
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moeti damane
@iamSANhedrin
Lets talk about the upcoming 1st meeting of the #FED #FOMC (28-29 January 2020). Specifically, lets talk about the #DOTS...
The #FED #FOMC developed the so called #DotPlot in 2011 as a chart to record each FED's official forecast for the FED's key short-term interest rate (federal funds rate - #FFR). Currently, the FFR, following the December 2019 meeting is in the target range between 1.5% and 1.75%
The most recent #DotPlot is attached below. Each dot represents one #FED official, from the Chairman to fellow Governors. It is anonymous & as such, no one knows which official is responsible for what dot...
Read 10 tweets
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David Jensen
@RealDavidJensen
@threadreaderapp Repo mkt has been in trouble since Sept 16.

Looking @ US banks w/ rate sensitive derivatives, the chart of Goldman Sachs looks the worst.

Goldman also has the largest interest rate derivatives book @ $42.3 T.

ibanknet.com/scripts/callre…
#fintwit #gold @ForexStopHunter
After a decade of loose money suspending debt bubble economy & mkts, #Fed central planners chop Money Supply to 2008 collapse level.

Rate increases of 2% on $72T of debt drive need for added $1.4T cash for interest payments ea. year w/ time.

#fintwit
...And, interest rate increases put some of the $210T of Bank-held interest rate derivatives in-the-money compounding cash demand in a market/economy already starved for cash.

Inter-bank lending dries, Repo borrowers begging for cash.

#fintwit #gold
Read 16 tweets
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pippocamminadritto
@guado77
l'impulso dalla creazione di quasi 3Trilioni di $ di riserve non spinge in maniera coerente e costante l'elargizione di nuovo credito da parte delle banche US👉NON C'E' DOMANDA
la moneta creata non "gira" come potrebbe/dovrebbe e lo vedi su
-Linea Nera:Inflazione attesa 5y FWD
...perché accade tutto questo?
perché da oltre 10 anno l'unico intento delle CBs è quello di salvaguardare il sistema finanziario come l'abbiamo sempre "conosciuto"...ma che è morto esattamente 11 anni fa...NON SIAMO MAI USCITI DALLA GFC 2008/09 e non usciremo mai in questo modo
...ed oggi vedremo quanto @potus è ricattabile...ha in mano il jolly per affondare EZ e lo DEVE giocare adesso...👽
ansa.it/europa/notizie…
Read 210 tweets
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Rajeev Pawar
@RajeevthePawar
Hearing the RBI Guv and the #Fed Chair talk over the past 24 hrs two interesting differences come through. Dr. Das is much more confident though reserved in committing to numbers. Jay Powell is more transparent but does not exude confidence in his words. /1

#RBI #India #ratecut
RBI Guv was quite clear that there is limited fiscal space. Wanted spending esp of PSUs to be front loaded. /2

#RBI #India #ratecut
On bond yields he felt the recent spike in yields was largely specific, external event driven. /3

#RBI #India #ratecut
Read 10 tweets
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Sei Kenja
@SeiKenja82
@WorldHijabDay Yea, no, I don't believe that for a second. I've DONE this and not just for a single day. I observed Islamic dress code for 2 weeks in 2002. I wanted to try and understand more about the people that produced the men who murdered my friend.
I covered even in my own home when there was a man not related to me. I wore Hijab and made certain my arms were covered and my clothing was loose. And you know what? It made me feel like I was worthless.
The ONLY positive that came of this experiment was that there were some younger people that ALSO lost friends/family on 9-11 and I was able to show them that (while I was not muslim) not everyone in islamic garb was a terrorist.
Read 17 tweets

Trending hashtags

#LePen #FFR #demographics #SouthKorea #eurusd #Silver #OIL #exports #liquidity #economy #Europe #geopolitics #brexit #DotPlot #MMT #FOMC #3M #Fed #Canada #japanification #Turkey #Crash #MEF #Taiwan #GBP

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