The term premium turned positive in early November and increased to more than 0.7 percentage points in January. … READ MORE >
Federal Reserve
Market Minute: Fed independence and the sum of all fears
Today, the sum of all fears among central bankers and economists can in large part be traced to the mistakes of the Arthur Burns era at the Fed. … READ MORE >
Market Minute: Transmission of monetary policy to the real economy
When the fiscal authority is at odds with monetary authority, then the transmission mechanism starts to break down. … READ MORE >
Market Minute: The risks in Treasury’s shift to T-bills
In 2025, 84% of the government’s debt issuance was made up of Treasury bills with maturities of 12 months or less, the highest ratio since the financial crisis. … READ MORE >
Market Minute: When the Fed’s reserves go from abundant to ample
Those who wish to return to the way things were before the financial crisis, before the Fed expanded its balance sheet, are living in a fantasy world. … READ MORE >
Market Minute: How sticky wages and inflation affect interest rates
A neutral federal funds rate in the range of a 3% to 3.5% nominal rate is more appropriate than the zero real (inflation-adjusted) terminal rate that some are calling for. … READ MORE >
Dude, that was one flawed CPI report
Growth in inflation eased to a 2.7% pace overall, and to 2.6% excluding food or energy. Because of an inability to retroactively collect the October data, it is difficult to precisely identify why top-line inflation slowed. … READ MORE >
The jobs data is out. If you are not confused, you are not paying attention.
Little clarity was provided by the combined October and November jobs data. The low-fire, low-hire jobs market remains intact as the unemployment rate continues to climb. … READ MORE >
The growth of government debt and its consequences for financial markets
The United States is borrowing roughly $7 billion per day to finance its operations with the deficit heading toward $2 trillion this fiscal year. … READ MORE >
Fed delivers hawkish cut, raising the bar for future reductions
The tone and tenor of the FOMC’s statement and remarks by Chairman Jerome Powell afterward substantially raised the bar for a rate cut in January. … READ MORE >