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Tag Archives: Central Banks

Nutty Bond Wonderland in Europe Just Reached New Heights of Madness

Not even the “bankruptcy” word hanging over super-troubled Italian infrastructure giants Atlantia and Autostrade, whose bridge collapsed last year, can get their bonds to reflect any kind of serious risk. By Nick Corbishley, for WOLF STREET: On Monday, Standard & Poor’s slashed Italian infrastructure giant Atlantia SpA’s credit rating by three notches, from investment-grade BBB- to BB- (“junk”) amid concerns the Italian government could revoke its all-important road concessions...

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Instability Rising: Why 2020 Will Be Different

Economically, the 11 years since the Global Financial Crisis of 2008-09 have been one relatively coherent era of modest growth, rising wealth/income inequality and coordinated central bank stimulus every time a crisis threatened to disrupt the domestic or global economy. This era will draw to a close in 2020 and a new era of destabilization and uncertainty begins. Why will all the policies that have worked so well for 11 years stop working in 2020? All the monetary/fiscal...

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War Drums! SchiffGold Friday Gold Wrap Jan. 10, 2020

The sound of war drums dominated this week. After Iran launched missiles at US bases in Iraq in retaliation for an airstrike that killed an Iranian general, gold spiked to over $1,600 an ounce — an eight-year high. But tensions seem to have eased and the price of gold with it, as the war drums have quieted. So, what did we learn from this and what’s next for the gold market? Host Mike Maharrey talks about it in this episode of the Friday Gold Wrap podcast.The SchiffGold Friday Gold Wrap...

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How Much Money Have Folks Already Lost Who Bought that Negative-Yielding 30-Year German Government Bond last August?

Something funny’s happening in NIRP land: long-term yields are rising, negative yields are turning positive, and investors are getting punished for having handed their brains to central banks. By Wolf Richter for WOLF STREET. So how much can you lose in a little over four months buying one of the most conservative investments, the German government 30-year bond, during peak-hype of the negative-interest-rate era? At peak-hype of the negative-interest-rate era, in mid-August 2019, the...

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More ECB Bond Holdings Get in Trouble: Infrastructure Giant Atlantia, Infamous for Collapsed Genoa Bridge, Could Lose its Core Business

Amid a slew of problems. By Nick Corbishley, for WOLF STREET: Italy could be on the verge of approving rules that would make it much easier and cheaper to revoke highway concessions. And that could be very bad news for Autostrade per l’Italia (ASPI), the private toll road operator that controls more than half of Italy’s aging toll roads and which is blamed for the collapse of the Morandi Bridge in Genoa in 2018 that resulted in 43 fatalities and left 600 people homeless. The regulatory...

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Status of US Dollar as Global Reserve Currency v. Euro, Yen, Chinese Renminbi, & Others

Latest data is out. Folks who hoped the Renminbi would break the dollar hegemony have to be very patient. By Wolf Richter for WOLF STREET. The US economy and financial system – including being able to maintain and fund the gargantuan trade deficits and fiscal deficits – has become reliant on the dollar being the dominant global reserve currency. And the IMF just released its next installment on how this status has been changing. Total foreign exchange reserves in all currencies...

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First Central Bank Exits Negative Interest Rates

Today’s rate hike by the central bank of Sweden ends an absurdity. ECB and other central banks with negative rates are getting ready to follow. The central bank of Sweden, the Riksbank, has thrown in the towel on negative interest rates, and has become the first central bank in history to do so. At its meeting on October 24, it said that it would “probably” do so, after already suggesting at its September meeting that it would do so. And today, it did so. It announced that it raised...

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The State of the Canadian Debt Slaves, How They Compare to American Debt Slaves, and the Bank of Canada’s Response

“The high household debt load is the most important risk facing the financial system”: Bank of Canada Governor Poloz, another central banker that bemoans the effects of this handiwork. By Wolf Richter for WOLF STREET. Canadian households, rated near the top of the most indebted in the world, accomplished something awe-inspiring: They got even more indebted and their leverage rose to a new record, according to data released today by Statistics Canada. The portion of their disposable...

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Is the Corporate-Debt Bubble Ripe Yet?

What does it mean when the Fed and other central banks jointly bemoan the effects of their own policies? Worried about not being able to keep all the plates spinning? This is the transcript from my podcast last Sunday, THE WOLF STREET REPORT: The Federal Reserve, the ECB, the individual central banks of Eurozone countries, such as the Bundesbank and the Bank of France, the central banks of negative-interest-rate countries outside the Eurozone, such as in Switzerland and Sweden, they’re...

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Central Banks Keep Right on Buying Gold

Globally, central bank gold reserves charted another healthy gain in October as they continue their quest to diversify reserves away from the US dollar.Central banks added another net 41.8 tons of gold to their reserves in October, according to the latest data from the World Gold Council.The World Gold Council bases its data on information submitted to the International Monetary Fund.Turkey led the pack for the second straight month, purchasing 12.8 tons of gold. The Turks have leapfrogged...

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