Fed Shocker: No 2019 Rate Hikes
The Fed won't make a move during the holidays, they be drinking with family. So all the Fed really said as no rate hike in Q3, and that makes sense.
I would the Fed to drop a quarter and say nothing. Whatever Q3 brings, let it come.
If the Fed moves are not white noise, then they are not good option makers. The Fed needs more information on the boards, it has to stop this running around with beige books and interviews and just get all their client an S/L account, some how. Then we can all peek at the board with equal market uncertainty, including the Fed. Prices will follow a Wiener process, the Fed currency risk account will be white noise, with trend negatively correlated to productivity changes, price neutral growth (or decay).
If we are doing a blue bar without a default contract, then I would suggest the Fed continue Ben's effort to expand the client set that banks at the Fed. The new kids in Congress will be confused, but just insist it is a move toward a more efficient economy, less ice melted. Efficiency means less ice melt for the current production, this is almost always true.
The Fed should be able to write a proposal that lets government agencies aggregate up to a Fed account via their own bureaucratic means, make them incentivized to get Fed accounts of the proper wholesale size.
Low impact rule changes, in line with Ben's approach. But the other rule change is to make the loan market a 'cash in advance' with asynchronous interest swaps to bound the market making risk. Then the Fed is a serial quantum computer and make the hologram better. Dissuade Congress from delaying the reforms with some stupid bailout.
If we are doing a blue bar without a default contract, then I would suggest the Fed continue Ben's effort to expand the client set that banks at the Fed. The new kids in Congress will be confused, but just insist it is a move toward a more efficient economy, less ice melted. Efficiency means less ice melt for the current production, this is almost always true.
The Fed should be able to write a proposal that lets government agencies aggregate up to a Fed account via their own bureaucratic means, make them incentivized to get Fed accounts of the proper wholesale size.
Low impact rule changes, in line with Ben's approach. But the other rule change is to make the loan market a 'cash in advance' with asynchronous interest swaps to bound the market making risk. Then the Fed is a serial quantum computer and make the hologram better. Dissuade Congress from delaying the reforms with some stupid bailout.
No comments:
Post a Comment