Ed’s Daily Notes for July 15th   2 comments

Bloomberg: Dollar Gains With Treasuries Before Yellen as Corn Slides

The dollar climbed against most major peers and Treasuries advanced with Asian stocks before Federal Reserve Chair Janet Yellen addresses U.S. lawmakers.

…“If Yellen indicates that she sees inflation expectations heating up, we might see prospects of a rate hike coming sooner than previously thought,” said Desmond Chua, a strategist at CMC Markets in Singapore. “This would definitely help in supporting dollar-yen, which has been deeply oversold recently.”

Yellen testifies before the Senate today at 10 am EST (and the House tomorrow at 10 am EST). My guess is she gives the usual “low rates as far as the eye can see” b.s. If that changes, we could actually see a correction.

Media Equalizer: The mega-Rick Rant returns!

One of the few tv networks I miss since I cut the cable has been CNBC. Of their on-air personalities, Rick Santelli was always one of my favorites, mainly because he is one of the few people on tv today who is willing to speak “truth to power” (isn’t that what journalists are supposed to do?).

CNBC’s Rick Santelli took on his stock bubble-intoxicated cable colleagues earlier today as they stuck to their usual support for endless money-printing to solve the world’s economic problems. With Santelli ultimately storming off the set, the results were explosive.

We’ve long wondered how Rick manages to stay sane working around CNBC’s relentlessly, mindlessly bullish on-air staff. While Santelli argues economic fundamentals, his co-workers counter with emotion and partisan political support for the current regime. Since memories tend to be short, most of the NBC business channel’s remaining viewers probably don’t realize it was just as brazen during the dot.com and 2007-2008 bubbles.

…So what exactly are his points? It’s actually simple…:

1. By keeping interest rates artificially low, the Janet Yellen-led Federal Reserve has encouraged reckless government borrowing and spending while crushing savers, especially America’s retirees.

2. The Fed has focused all its efforts on making the rich even richer through Quantitative Easing while working people suffer and are ignored by Washington’s elite.

But at CNBC, he’s talking to the walls as their support is 100% behind the Hamptons / Greenwich hedge fund class, who have been closely tied to the current presidential administration.

Politico: The Rand Paul pile on

If you had any doubts about how seriously some Republicans are taking the notion of a Rand Paul presidency, look at how far they’re going to shut down his views on foreign policy.

In the past three days alone, Texas Gov. Rick Perry used a Washington Post op-ed to warn about the dangers of “isolationism” and describe Paul as “curiously blind” to growing threats in Iraq. Sen. John McCain (R-Ariz.) accused the Kentucky senator on CNN of wanting a “withdrawal to fortress America.” And former Vice President Dick Cheney declared at a POLITICO Playbook luncheon on Monday that “isolationism is crazy,” while his daughter, Liz Cheney, said Paul “leaves something to be desired, in terms of national security policy.”

The preemptive strikes suggest that many in GOP fear Paul is winning the foreign policy argument with the American people — and that that could make him a formidable candidate in 2016. After all, second-tier presidential hopefuls don’t usually get shouted down this way.

Considering the line of idiots and “war at all costs” hawks lined up against him, Rand Paul is looking pretty good right now. In my view, America has been too “knee-jerk” with wars over the past 13 years. Chasing down every two-bit terrorist in the world is a costly and futile endeavor, and could be creating more of them with our reckless disregard for other countries.

Rand Paul shows a rather intelligent and nuanced view of foreign policy in his reply to Rick Perry’s editorial. I would recommend Paul’s reply as a must-read (link here).

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Posted July 15, 2014 by edmcgon in Editorial/opinion, Federal Reserve, News, Politics

2 responses to “Ed’s Daily Notes for July 15th

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  1. I used to watch Santelli almost every day. However, his “theater” becomes old after a year or two. When you listen to the other side of the interview you do have to wonder how many years we have to wait until Santelli’s doom will appear. When he first began railing against the Fed’s policy he was predicting inflation within two years — that was three years ago.

  2. “If that changes, we could actually see a correction.”

    Is the black swan event you are hoping will allow you to buy back in at a price last seen about a year or more ago?

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