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Bullard: Taper would "recognize" labor improvement

  • The chances of the taper have increased thanks to the recent labor market data, says St. Louis Fed chief Jim Bullard, but below-target inflation remains an issue. "There is no widely accepted reason why inflation is running as low as it is in the face of extraordinarily accommodative policy from the Fed,” he says. “A small taper might recognize labor market improvement while still providing the Committee the opportunity to carefully monitor inflation during the first half of 2014 ... Should inflation not return toward target, the Committee could pause tapering at subsequent meetings."
  • Like John Williams last week, Bullard suggests a change in forward guidance may be in order to convince markets the taper and a rate hike are two separate issues.
  • Treasurys remain little-changed on the session, the 10-year yield off a basis point to 2.85%.
  • Treasury ETFs: TBT, TLT, TMV, SHY, IEF, TBF, PST, EDV, TTT, TMF, TLH, ZROZ, SBND, IEI, DLBS, TYO, DTYS, VGLT, UST, BIL, SHV, UBT, TBX, TLO, VGSH, VGIT, LBND, GSY, DTYL, SCHR, SCHO, TYD, ITE, TYBS, TENZ, DTUL, TUZ, SST, DTUS, FIVZ, TBZ, DFVL, DLBL, DFVS, TYNS
Comments (11)
  • Ted Bear
    , contributor
    Comments (573) | Send Message
     
    Oh for even a whiff of inflation to bail out the ills of this monetary policy, and the lack of any sort of a fiscal policy.

     

    But it is not happening...hence the reluctance to end QE for fear that deflation will overtake the system, and we all know what that portends.

     

    There is academia, and there is real life. We are closer than ever to seeing the difference between the two.
    9 Dec 2013, 01:20 PM Reply Like
  • DeepValueLover
    , contributor
    Comments (8140) | Send Message
     
    Krugman ally Yellen simply won't do ANYTHING that may remove protective barriers to the deflationary storm.

     

    She wants inflation and she wants it now.

     

    Who will step in and buy $5 billion per month more in Treasuries who isn't already buying? (Especially since institutions would KNOW they'd be buying more of a declining asset)

     

    No taper until 2016 or later.
    9 Dec 2013, 03:42 PM Reply Like
  • buffett222
    , contributor
    Comments (776) | Send Message
     
    Japanese are buying long end.
    9 Dec 2013, 05:51 PM Reply Like
  • DeepValueLover
    , contributor
    Comments (8140) | Send Message
     
    Have Japanese firms or the central bank indicated that they are prepared to increase purchases to at least $5 billion more per month than current purchases?
    10 Dec 2013, 07:43 AM Reply Like
  • bfstrog
    , contributor
    Comments (71) | Send Message
     
    ZIRP and QE have no effect on inflation in a balance sheet depression (with the exception of the stock "market" wealth effect) , which has been ongoing for nearly 6 years, because the velocity of money has collapsed. You can lead a over-leveraged part time employee to a loan, but you can't make him take it, or the bank give it, when stocks are projected to go up forever. Google a chart of money velocity and it's easy to understand.

     

    http://bit.ly/RyAD4E

     

    http://bit.ly/yfiMV9
    9 Dec 2013, 03:48 PM Reply Like
  • buyandhold???
    , contributor
    Comments (884) | Send Message
     
    bullard has been saying this for months, nothing to see here
    9 Dec 2013, 05:03 PM Reply Like
  • Darren McCammon
    , contributor
    Comments (846) | Send Message
     
    Just more leaking / testing of a slightly reduced taper accompanied by lower unemployment or higher inflation target. OK, guys and gals, we get it.
    9 Dec 2013, 06:56 PM Reply Like
  • Kyle Spencer
    , contributor
    Comments (998) | Send Message
     
    Bullard's seen as a comer, and Yellen has been signalling that she wants to switch from bond buying to forward guidance for awhile, now.
    9 Dec 2013, 08:02 PM Reply Like
  • WisPokerGuy
    , contributor
    Comments (777) | Send Message
     
    Have to disagree.

     

    Bullard is a known Fed hawk. Where's the news here? Unless your first name is "Janet" the opinion of the minions really means little.
    9 Dec 2013, 09:50 PM Reply Like
  • fanebrp
    , contributor
    Comments (278) | Send Message
     
    All that new worthless paper will come home to roost. It's only good for starting a fire !
    10 Dec 2013, 02:54 AM Reply Like
  • WisPokerGuy
    , contributor
    Comments (777) | Send Message
     
    I'll be glad to take any you don't want off your hands. Because unless you are entirely in gold moving forward, your comment holds little meaning because you're not willing to back it up with action. Therefore, it's little more then meaningless noise.
    10 Dec 2013, 09:50 AM Reply Like
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