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<title>Minyanville - Vince Foster RSS</title>
<description>
The Trusted Choice for the Wall Street Voice
</description>
<link>
		http://www.minyanville.com</link>
<copyright>
		2013Minyanville Publishing and Multimedia, LLC. All Rights Reserved
</copyright>
		<item>
<title><![CDATA[The Mother of All Short Squeezes]]></title>
<link>
			http://www.minyanville.com/business-news/markets/articles/Mother-of-All-Short-Squeezes-stock/5/20/2013/id/49907</link>
<pubDate>
			Mon, 20 May 2013 10:32:00EST
</pubDate>
<guid isPermaLink="true">
			http://www.minyanville.com/business-news/markets/articles/Mother-of-All-Short-Squeezes-stock/5/20/2013/id/49907</guid>
<description>
<![CDATA[This week, as I watched the nature of the price action in stocks, I couldn't help but be reminded of how the market was behaving in 2011.  No, not the QE II rally in stocks during the first half of the year but rather during the August meltdown that blew up that very crowded and leveraged long risk position. 

When Ben Bernanke kicked off the notion of QE II at Jackson Hole, I began monitoring what I deemed the reflation correlation trade whereby all dollar-denominated reflated risk assets rallied inverse to the price of the dollar.  Below is a timeline ]]>
</description>
<content:encoded>
	<![CDATA[This week, as I watched the nature of the price action in stocks, I couldn't help but be reminded of how the market was behaving in 2011.  No, not the QE II rally in stocks during the first half of the year but rather during the August meltdown that blew up that very crowded and leveraged long risk position. 

When Ben Bernanke kicked off the notion of QE II at Jackson Hole, I began monitoring what I deemed the reflation correlation trade whereby all dollar-denominated reflated risk assets rallied inverse to the price of the dollar.  Below is a timeline ]]>
</content:encoded>
			</item>
			<item>
<title><![CDATA[Welcome to the Dark Side of QE: The Yield Curve Adjustment Process]]></title>
<link>
			http://www.minyanville.com/business-news/politics-and-regulation/articles/Dark-Side-of-QE-Yield-Curve/5/13/2013/id/49773</link>
<pubDate>
			Mon, 13 May 2013 10:07:00EST
</pubDate>
<guid isPermaLink="true">
			http://www.minyanville.com/business-news/politics-and-regulation/articles/Dark-Side-of-QE-Yield-Curve/5/13/2013/id/49773</guid>
<description>
<![CDATA[On Thursday the Treasury auctioned off the 30-year bond in what appeared to be strong buy-side demand.  Indirect bidders who represent foreign central banks took down 39%, of which was above recent levels of recent foreign participation.  As soon as the results hit the tape, the USDJPY started spiking on what appeared to be Japanese accounts swapping into dollars to finance their 30-year allocations.  That yen-selling pushed USDJPY above the psychological 100 level which seemed to trigger some buy stops as the currency pair continued to rally quickly, hitting the 100.50 level.

USDJPY 2-Day Tick



The spike through 100 turned ]]>
</description>
<content:encoded>
	<![CDATA[On Thursday the Treasury auctioned off the 30-year bond in what appeared to be strong buy-side demand.  Indirect bidders who represent foreign central banks took down 39%, of which was above recent levels of recent foreign participation.  As soon as the results hit the tape, the USDJPY started spiking on what appeared to be Japanese accounts swapping into dollars to finance their 30-year allocations.  That yen-selling pushed USDJPY above the psychological 100 level which seemed to trigger some buy stops as the currency pair continued to rally quickly, hitting the 100.50 level.

USDJPY 2-Day Tick



The spike through 100 turned ]]>
</content:encoded>
			</item>
			<item>
<title><![CDATA[The Low Spark of High Yield Boys, Redux]]></title>
<link>
			http://www.minyanville.com/business-news/markets/articles/Low-Spark-of-High-Yield-Boys/5/6/2013/id/49643</link>
<pubDate>
			Mon, 6 May 2013 10:36:00EST
</pubDate>
<guid isPermaLink="true">
			http://www.minyanville.com/business-news/markets/articles/Low-Spark-of-High-Yield-Boys/5/6/2013/id/49643</guid>
<description>
<![CDATA[The percentage you&#39;re paying is too high priced
	while you&#39;re living beyond all your means.
	And the man in the suit has just bought a new car
	from the profit he&#39;s made on your dreams.
	But today you just swear that the man was shot dead
	by a gun that didn&#39;t make any noise.
	But it wasn&#39;t the bullet that laid him to rest
	was the low spark of high-heeled boys.
	
	The Low Spark of High-Heeled Boys
	-- Jim Capaldi and Steve Winwood, Traffic

	Amid all the euphoria this week as US stocks broke out to new highs on weaker ]]>
</description>
<content:encoded>
	<![CDATA[The percentage you&#39;re paying is too high priced
	while you&#39;re living beyond all your means.
	And the man in the suit has just bought a new car
	from the profit he&#39;s made on your dreams.
	But today you just swear that the man was shot dead
	by a gun that didn&#39;t make any noise.
	But it wasn&#39;t the bullet that laid him to rest
	was the low spark of high-heeled boys.
	
	The Low Spark of High-Heeled Boys
	-- Jim Capaldi and Steve Winwood, Traffic

	Amid all the euphoria this week as US stocks broke out to new highs on weaker ]]>
</content:encoded>
			</item>
			<item>
<title><![CDATA[When the Market's Momentum Shifts, So Too Will the Robot Traders' Mission]]></title>
<link>
			http://www.minyanville.com/business-news/markets/articles/When-the-Market2527s-Momentum-Shifts-So/4/29/2013/id/49518</link>
<pubDate>
			Mon, 29 Apr 2013 09:40:00EST
</pubDate>
<guid isPermaLink="true">
			http://www.minyanville.com/business-news/markets/articles/When-the-Market2527s-Momentum-Shifts-So/4/29/2013/id/49518</guid>
<description>
<![CDATA[Tuesday morning I was chatting it up on IM with Minyanville's Michael Sedacca about how the day's events were unfolding.  We had just received successive weaker than expected manufacturing reports from China, Germany, and the US yet stocks maintained their bias to the upside.


	09:21:07  Michael Sedacca: today will be an interesting day
	09:38:29  Vincent Foster: this is pretty remarkable
	09:47:27  Michael Sedacca: right at the 61.8% retrace of the whole move
	09:49:37  Vincent Foster: not sure numbers matter at this point
	09:49:42  Vincent Foster: its all momo
	09:49:50  Vincent Foster: hal 9000 is in charge

Momo is short for ]]>
</description>
<content:encoded>
	<![CDATA[Tuesday morning I was chatting it up on IM with Minyanville's Michael Sedacca about how the day's events were unfolding.  We had just received successive weaker than expected manufacturing reports from China, Germany, and the US yet stocks maintained their bias to the upside.


	09:21:07  Michael Sedacca: today will be an interesting day
	09:38:29  Vincent Foster: this is pretty remarkable
	09:47:27  Michael Sedacca: right at the 61.8% retrace of the whole move
	09:49:37  Vincent Foster: not sure numbers matter at this point
	09:49:42  Vincent Foster: its all momo
	09:49:50  Vincent Foster: hal 9000 is in charge

Momo is short for ]]>
</content:encoded>
			</item>
			<item>
<title><![CDATA[Gold, Interest Rates, and the Great USD Short Unwind]]></title>
<link>
			http://www.minyanville.com/trading-and-investing/commodities/articles/Gold-Interest-Rates-and-the-Great/4/22/2013/id/49385</link>
<pubDate>
			Mon, 22 Apr 2013 09:42:00EST
</pubDate>
<guid isPermaLink="true">
			http://www.minyanville.com/trading-and-investing/commodities/articles/Gold-Interest-Rates-and-the-Great/4/22/2013/id/49385</guid>
<description>
<![CDATA[The financial media likes to frame the markets into simple, data-driven, cause-and-effect nonsense producing high-frequency asset allocation shifts such as risk-on/risk-off and the great rotation out of bonds and into stocks.  They discuss whether money is flowing in and out of these assets and why this may be happening.  Market price action is much more complicated than this elementary portrayal, but at the same time, much simpler when broken down to the basic transaction.

On April 8 in Bond Yields Are Falling Because the Consumption Bubble Is Imploding my point was to show that the bond market was discounting something ]]>
</description>
<content:encoded>
	<![CDATA[The financial media likes to frame the markets into simple, data-driven, cause-and-effect nonsense producing high-frequency asset allocation shifts such as risk-on/risk-off and the great rotation out of bonds and into stocks.  They discuss whether money is flowing in and out of these assets and why this may be happening.  Market price action is much more complicated than this elementary portrayal, but at the same time, much simpler when broken down to the basic transaction.

On April 8 in Bond Yields Are Falling Because the Consumption Bubble Is Imploding my point was to show that the bond market was discounting something ]]>
</content:encoded>
			</item>
			<item>
<title><![CDATA[Contrary to Consensus: Why Tapering QE Is Bullish for Treasuries]]></title>
<link>
			http://www.minyanville.com/trading-and-investing/fixed-income/articles/Contrary-to-Consensus253A-Why-Tapering-QE/4/15/2013/id/49255</link>
<pubDate>
			Mon, 15 Apr 2013 09:45:00EST
</pubDate>
<guid isPermaLink="true">
			http://www.minyanville.com/trading-and-investing/fixed-income/articles/Contrary-to-Consensus253A-Why-Tapering-QE/4/15/2013/id/49255</guid>
<description>
<![CDATA[This week's release of the March 20 FOMC minutes has put the QE tapering and exit talk front and center, and despite the weakening economic data of late, bond investors are analyzing how to position for the eventual reduction in accommodation.  With stocks going parabolic to new highs into decelerating growth, at this point it seems the Fed is more concerned with excessive risk-taking behavior.  This sentiment has been echoed in recent Fed governor speeches and even implied by rhetoric in the dovish wing of the Fed.  In Wednesday's FOMC minutes the committee put forth their "Review of Efficacy and ]]>
</description>
<content:encoded>
	<![CDATA[This week's release of the March 20 FOMC minutes has put the QE tapering and exit talk front and center, and despite the weakening economic data of late, bond investors are analyzing how to position for the eventual reduction in accommodation.  With stocks going parabolic to new highs into decelerating growth, at this point it seems the Fed is more concerned with excessive risk-taking behavior.  This sentiment has been echoed in recent Fed governor speeches and even implied by rhetoric in the dovish wing of the Fed.  In Wednesday's FOMC minutes the committee put forth their "Review of Efficacy and ]]>
</content:encoded>
			</item>
			<item>
<title><![CDATA[Bond Yields Are Falling Because the Consumption Bubble Is Imploding]]></title>
<link>
			http://www.minyanville.com/trading-and-investing/fixed-income/articles/Bond-Yields-Are-Falling-Because-the/4/8/2013/id/49124</link>
<pubDate>
			Mon, 8 Apr 2013 09:50:00EST
</pubDate>
<guid isPermaLink="true">
			http://www.minyanville.com/trading-and-investing/fixed-income/articles/Bond-Yields-Are-Falling-Because-the/4/8/2013/id/49124</guid>
<description>
<![CDATA[You wouldn't know it by the Dow&#39;s (INDEXDJX:.DJI) muted reaction but Friday's employment data was not only much weaker than expected, it was one of the worst months since the economy emerged from the recession.  The number that matters, private payroll gains, was a mere 95,000 -- the third weakest month of job growth since the data turned positive in 2010 and well below the average of 177,000 since then.  The real freaky number is the participation rate which fell to 63.3%, the lowest since 1979 as 500,000 dropped out of the labor force.  Combining the first three months together ]]>
</description>
<content:encoded>
	<![CDATA[You wouldn't know it by the Dow&#39;s (INDEXDJX:.DJI) muted reaction but Friday's employment data was not only much weaker than expected, it was one of the worst months since the economy emerged from the recession.  The number that matters, private payroll gains, was a mere 95,000 -- the third weakest month of job growth since the data turned positive in 2010 and well below the average of 177,000 since then.  The real freaky number is the participation rate which fell to 63.3%, the lowest since 1979 as 500,000 dropped out of the labor force.  Combining the first three months together ]]>
</content:encoded>
			</item>
			<item>
<title><![CDATA[Amid Stock Market Euphoria, the Smart Money Is Fading]]></title>
<link>
			http://www.minyanville.com/business-news/markets/articles/Amid-Stock-Market-Euphoria-the-Smart/4/1/2013/id/48993</link>
<pubDate>
			Mon, 1 Apr 2013 09:30:00EST
</pubDate>
<guid isPermaLink="true">
			http://www.minyanville.com/business-news/markets/articles/Amid-Stock-Market-Euphoria-the-Smart/4/1/2013/id/48993</guid>
<description>
<![CDATA[With the first quarter in the bag and the stock market at new highs, I wanted to recognize and analyze a couple of interesting divergences that are developing among what I would consider smart money investors, and may be telling a different story that what you are hare hearing from media pundits and Wall Street strategists. 

With speculators maintaining record long positions in the S&P 500 (INDEXSP:.INX) e-mini after being short for most of the rally off the 2011 lows, it's pretty clear to me that underexposed hedge funds are behind this parabolic advance.  Hedge fund investors might even have ]]>
</description>
<content:encoded>
	<![CDATA[With the first quarter in the bag and the stock market at new highs, I wanted to recognize and analyze a couple of interesting divergences that are developing among what I would consider smart money investors, and may be telling a different story that what you are hare hearing from media pundits and Wall Street strategists. 

With speculators maintaining record long positions in the S&P 500 (INDEXSP:.INX) e-mini after being short for most of the rally off the 2011 lows, it's pretty clear to me that underexposed hedge funds are behind this parabolic advance.  Hedge fund investors might even have ]]>
</content:encoded>
			</item>
			<item>
<title><![CDATA[QE Correlation Does Not Imply QE Causation]]></title>
<link>
			http://www.minyanville.com/business-news/markets/articles/QE-Correlation-Does-Not-Imply-QE/3/25/2013/id/48891</link>
<pubDate>
			Mon, 25 Mar 2013 10:26:00EST
</pubDate>
<guid isPermaLink="true">
			http://www.minyanville.com/business-news/markets/articles/QE-Correlation-Does-Not-Imply-QE/3/25/2013/id/48891</guid>
<description>
<![CDATA[Following this week's FOMC meeting Chairman Bernanke held a press conference to allow members of the financial media to ask questions about the direction and efficacy of monetary policy.  Chairman Bernanke has tried to increase transparency by providing more communication of monetary methodologies and intentions, however the members of the media have failed miserably at extracting information that is not already spoon-fed to the markets.  This past week was a glaring example of how inept and downright negligent the financial media has become in evaluating Fed policy.

The line of questioning can be categorized in four basic subjects: the remaining ]]>
</description>
<content:encoded>
	<![CDATA[Following this week's FOMC meeting Chairman Bernanke held a press conference to allow members of the financial media to ask questions about the direction and efficacy of monetary policy.  Chairman Bernanke has tried to increase transparency by providing more communication of monetary methodologies and intentions, however the members of the media have failed miserably at extracting information that is not already spoon-fed to the markets.  This past week was a glaring example of how inept and downright negligent the financial media has become in evaluating Fed policy.

The line of questioning can be categorized in four basic subjects: the remaining ]]>
</content:encoded>
			</item>
			<item>
<title><![CDATA[The Banking System Is Both Too Big and Not Big Enough]]></title>
<link>
			http://www.minyanville.com/sectors/financial/articles/Banking-System-Is-Too-Big-and/3/18/2013/id/48761</link>
<pubDate>
			Mon, 18 Mar 2013 09:45:00EST
</pubDate>
<guid isPermaLink="true">
			http://www.minyanville.com/sectors/financial/articles/Banking-System-Is-Too-Big-and/3/18/2013/id/48761</guid>
<description>
<![CDATA[Going into the weekend I wanted to write about data that showed household net worth was the highest since 2007, and more specifically, examine how we got back to that $66 trillion level.  Then on Friday with news that the US Treasury had requested information of all 10-year note holders above $2 billion in assets, I thought about speculating on what was behind the recent 10-year note repo squeeze.  I came to realize they were both part of the same story.

When the Fed's Flow of Funds data was released two weeks ago, the focus was not on how many ]]>
</description>
<content:encoded>
	<![CDATA[Going into the weekend I wanted to write about data that showed household net worth was the highest since 2007, and more specifically, examine how we got back to that $66 trillion level.  Then on Friday with news that the US Treasury had requested information of all 10-year note holders above $2 billion in assets, I thought about speculating on what was behind the recent 10-year note repo squeeze.  I came to realize they were both part of the same story.

When the Fed's Flow of Funds data was released two weeks ago, the focus was not on how many ]]>
</content:encoded>
			</item>
			<item>
<title><![CDATA[Quantitative Easing: The Greatest Con Ever Sold]]></title>
<link>
			http://www.minyanville.com/business-news/markets/articles/Quantitative-Easing253A-The-Greatest-Con-Ever/3/11/2013/id/48629</link>
<pubDate>
			Mon, 11 Mar 2013 09:30:00EST
</pubDate>
<guid isPermaLink="true">
			http://www.minyanville.com/business-news/markets/articles/Quantitative-Easing253A-The-Greatest-Con-Ever/3/11/2013/id/48629</guid>
<description>
<![CDATA[Last week the bond market continued to be put to the test, and if it could go wrong, it did go wrong.  Across the board stronger than expected economic data, including Friday's better than expected employment data, provided plenty off ammo for risk behavior that saw the yen make new lows against the dollar, pushing equities to new highs with the Dow (INDEXDJX:.DJI) making a new all-time high seemingly every day. The upward momentum was not lost on the mainstream media as on Thursday I heard CBS Evening News anchor Scott Pelly refer to the announcement of a new high ]]>
</description>
<content:encoded>
	<![CDATA[Last week the bond market continued to be put to the test, and if it could go wrong, it did go wrong.  Across the board stronger than expected economic data, including Friday's better than expected employment data, provided plenty off ammo for risk behavior that saw the yen make new lows against the dollar, pushing equities to new highs with the Dow (INDEXDJX:.DJI) making a new all-time high seemingly every day. The upward momentum was not lost on the mainstream media as on Thursday I heard CBS Evening News anchor Scott Pelly refer to the announcement of a new high ]]>
</content:encoded>
			</item>
			<item>
<title><![CDATA[Bond Market Strength Forged in the Fires of Adversity]]></title>
<link>
			http://www.minyanville.com/trading-and-investing/fixed-income/articles/Bond-Market-Strength-Forged-in-the/3/4/2013/id/48501</link>
<pubDate>
			Mon, 4 Mar 2013 09:40:00EST
</pubDate>
<guid isPermaLink="true">
			http://www.minyanville.com/trading-and-investing/fixed-income/articles/Bond-Market-Strength-Forged-in-the/3/4/2013/id/48501</guid>
<description>
<![CDATA[Last week investors were provided a wake-up call regarding the effects of currency volatility risk lurking beneath the surface of equity and bond markets.  Since the beginning of the year I have warned that the insane volatility would eventually find its way into US markets, and Monday (Feb. 25) we got our first taste test of what this looks like.  On January 22, my article Are We Witnessing a Tectonic Shift in Which Central Bank Policy Dominates Asset Prices and Risk Premiums? pointing to the parabolic moves in EURJPY and THBJPY, I concluded:


	The FX market is very deep and ]]>
</description>
<content:encoded>
	<![CDATA[Last week investors were provided a wake-up call regarding the effects of currency volatility risk lurking beneath the surface of equity and bond markets.  Since the beginning of the year I have warned that the insane volatility would eventually find its way into US markets, and Monday (Feb. 25) we got our first taste test of what this looks like.  On January 22, my article Are We Witnessing a Tectonic Shift in Which Central Bank Policy Dominates Asset Prices and Risk Premiums? pointing to the parabolic moves in EURJPY and THBJPY, I concluded:


	The FX market is very deep and ]]>
</content:encoded>
			</item>
			<item>
<title><![CDATA[Bernanke's Date With Deflationary Destiny]]></title>
<link>
			http://www.minyanville.com/business-news/politics-and-regulation/articles/deflation-fomc-monetary-policy-qe-fed/2/25/2013/id/48331</link>
<pubDate>
			Mon, 25 Feb 2013 09:55:00EST
</pubDate>
<guid isPermaLink="true">
			http://www.minyanville.com/business-news/politics-and-regulation/articles/deflation-fomc-monetary-policy-qe-fed/2/25/2013/id/48331</guid>
<description>
<![CDATA[At the December 12, 2012 FOMC meeting, the committee increased the previously announced QE III to include US Treasuries amounting to total stimulus of approximately $85 billion per month. At the same time they introduced economic "thresholds" targeting a 6.5% unemployment rate while not exceeding a 2.5% inflation rate.  At the time I viewed this simultaneous raising of the inflation rate from 2.0% to 2.5% in order to bring down unemployment as a de facto nominal GDP target which was something Chairman Bernanke had said would be "reckless" at the previous April FOMC press conference.

My concern was this new ]]>
</description>
<content:encoded>
	<![CDATA[At the December 12, 2012 FOMC meeting, the committee increased the previously announced QE III to include US Treasuries amounting to total stimulus of approximately $85 billion per month. At the same time they introduced economic "thresholds" targeting a 6.5% unemployment rate while not exceeding a 2.5% inflation rate.  At the time I viewed this simultaneous raising of the inflation rate from 2.0% to 2.5% in order to bring down unemployment as a de facto nominal GDP target which was something Chairman Bernanke had said would be "reckless" at the previous April FOMC press conference.

My concern was this new ]]>
</content:encoded>
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			<item>
<title><![CDATA[Bond Market Convexity: Objects in Mirror Are Closer Than They Appear]]></title>
<link>
			http://www.minyanville.com/trading-and-investing/fixed-income/articles/Bond-Market-Convexity253A-Objects-in-Mirror/2/19/2013/id/48186</link>
<pubDate>
			Tue, 19 Feb 2013 10:25:00EST
</pubDate>
<guid isPermaLink="true">
			http://www.minyanville.com/trading-and-investing/fixed-income/articles/Bond-Market-Convexity253A-Objects-in-Mirror/2/19/2013/id/48186</guid>
<description>
<![CDATA[FX volatility was front and center last week as rhetoric from the G7, G20, and Bank of Japan dominated headlines and yen price action.  With US stocks grinding higher, the bond market has been bearing the brunt of the yen volatility with the US bond futures contract continuing to vibrate the 143-00 level I cited as a price objective in my year-end 2013 Bond Market Prognostication:
 

	What Are the Levels to Watch for in 2013?
 

	I think 143-00 is a huge number. It was a climax top in 2008. It was made support in 2011 and 2012, and it's very ]]>
</description>
<content:encoded>
	<![CDATA[FX volatility was front and center last week as rhetoric from the G7, G20, and Bank of Japan dominated headlines and yen price action.  With US stocks grinding higher, the bond market has been bearing the brunt of the yen volatility with the US bond futures contract continuing to vibrate the 143-00 level I cited as a price objective in my year-end 2013 Bond Market Prognostication:
 

	What Are the Levels to Watch for in 2013?
 

	I think 143-00 is a huge number. It was a climax top in 2008. It was made support in 2011 and 2012, and it's very ]]>
</content:encoded>
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			<item>
<title><![CDATA[Bank of Japan Meeting: The St. Valentine's Day Massacre]]></title>
<link>
			http://www.minyanville.com/sectors/global-markets/articles/Bank-of-Japan-Meeting-The-St/2/11/2013/id/48012</link>
<pubDate>
			Mon, 11 Feb 2013 09:05:00EST
</pubDate>
<guid isPermaLink="true">
			http://www.minyanville.com/sectors/global-markets/articles/Bank-of-Japan-Meeting-The-St/2/11/2013/id/48012</guid>
<description>
<![CDATA[In December 1999 Ben Bernanke delivered a paper titled Japanese Monetary Policy:  A Case of Self-Induced Paralysis? whereby he criticized the Bank of Japan for not doing enough to stem the deflation that had plagued Japan throughout the 1990s.  In the section titled How to Get Out of a Liquidity Trap, Bernanke goes through his playbook for how to stimulate aggregate demand once interest rates have hit the zero bound.  His remedies are all too familiar to us now and include an inflation target, depreciating the currency, the so-called helicopter drop of money and "non-standard" asset purchases:


	In particular, a ]]>
</description>
<content:encoded>
	<![CDATA[In December 1999 Ben Bernanke delivered a paper titled Japanese Monetary Policy:  A Case of Self-Induced Paralysis? whereby he criticized the Bank of Japan for not doing enough to stem the deflation that had plagued Japan throughout the 1990s.  In the section titled How to Get Out of a Liquidity Trap, Bernanke goes through his playbook for how to stimulate aggregate demand once interest rates have hit the zero bound.  His remedies are all too familiar to us now and include an inflation target, depreciating the currency, the so-called helicopter drop of money and "non-standard" asset purchases:


	In particular, a ]]>
</content:encoded>
			</item>
			<item>
<title><![CDATA[What's Driving Intense Volatility in the Bond Market? Three Possible Explanations]]></title>
<link>
			http://www.minyanville.com/trading-and-investing/fixed-income/articles/Bond-Market-Volatility-bond-market-bonds/2/4/2013/id/47848</link>
<pubDate>
			Mon, 4 Feb 2013 09:30:00EST
</pubDate>
<guid isPermaLink="true">
			http://www.minyanville.com/trading-and-investing/fixed-income/articles/Bond-Market-Volatility-bond-market-bonds/2/4/2013/id/47848</guid>
<description>
<![CDATA[Equity investors went home this past weekend feeling pretty proud of themselves. For many who recently (and finally) gained net exposure to the market and after a blistering January, stocks started February with a robust 1% gain. The sentiment has improved not because economic conditions are better but rather because prices are higher.

Last week we saw the first estimate of Q4 2012 GDP and it was a stinker.  The number that matters, YOY nominal GDP, grew at a paltry 3.3%.  This was one of the lowest prints since coming out of the recession and a sharp deceleration from Q4 ]]>
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	<![CDATA[Equity investors went home this past weekend feeling pretty proud of themselves. For many who recently (and finally) gained net exposure to the market and after a blistering January, stocks started February with a robust 1% gain. The sentiment has improved not because economic conditions are better but rather because prices are higher.

Last week we saw the first estimate of Q4 2012 GDP and it was a stinker.  The number that matters, YOY nominal GDP, grew at a paltry 3.3%.  This was one of the lowest prints since coming out of the recession and a sharp deceleration from Q4 ]]>
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<title><![CDATA[The Great Rotation? The Market Is a Bit More Complicated Than That]]></title>
<link>
			http://www.minyanville.com/business-news/markets/articles/the-great-rotation-markets-market-s2526p500/1/28/2013/id/47668</link>
<pubDate>
			Mon, 28 Jan 2013 09:22:00EST
</pubDate>
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			http://www.minyanville.com/business-news/markets/articles/the-great-rotation-markets-market-s2526p500/1/28/2013/id/47668</guid>
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<![CDATA[On June 12 of last year I suggested that the prevailing market dynamic was a function of a Wrong Playbook Bubble whereby participants had failed to identify what was driving market price.  The basic conclusion was that the so-called "smart money," due to their fundamental bias that was focused on economic and earnings growth, failed to consider the technical nature of a market that was impossible to quantify in a model.


	At the same time that the Fed was taking the discount out of the discount rate, we saw an explosion of financial analysts, investment bankers, and so-called alpha-generating hedge ]]>
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	<![CDATA[On June 12 of last year I suggested that the prevailing market dynamic was a function of a Wrong Playbook Bubble whereby participants had failed to identify what was driving market price.  The basic conclusion was that the so-called "smart money," due to their fundamental bias that was focused on economic and earnings growth, failed to consider the technical nature of a market that was impossible to quantify in a model.


	At the same time that the Fed was taking the discount out of the discount rate, we saw an explosion of financial analysts, investment bankers, and so-called alpha-generating hedge ]]>
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<title><![CDATA[Are We Witnessing a Tectonic Shift in Which Central Bank Policy Dominates Asset Prices and Risk Premiums?]]></title>
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			http://www.minyanville.com/trading-and-investing/currencies/articles/Japan2527s-Inflation-Target-Change-Central-Bank/1/22/2013/id/47526</link>
<pubDate>
			Tue, 22 Jan 2013 11:52:00EST
</pubDate>
<guid isPermaLink="true">
			http://www.minyanville.com/trading-and-investing/currencies/articles/Japan2527s-Inflation-Target-Change-Central-Bank/1/22/2013/id/47526</guid>
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<![CDATA[Friday, Jan. 18, the Federal Reserve released the transcripts from 2007 FOMC meetings that included those fateful days as they grappled with how to address the housing "correction" and developing credit crisis.
 
At the August 7, 2007 FOMC meeting it was clear the Fed was not all that concerned with escalating systemic risk as the agenda was full of fond farewells, jokes, laughter and bureaucratic nonsense.  They concluded by debating the semantics of the statement.
 

	Chairman Bernanke: Okay. Let me just get a sense around the table, if I could. I think President Hoenig makes the point that volatility in ]]>
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	<![CDATA[Friday, Jan. 18, the Federal Reserve released the transcripts from 2007 FOMC meetings that included those fateful days as they grappled with how to address the housing "correction" and developing credit crisis.
 
At the August 7, 2007 FOMC meeting it was clear the Fed was not all that concerned with escalating systemic risk as the agenda was full of fond farewells, jokes, laughter and bureaucratic nonsense.  They concluded by debating the semantics of the statement.
 

	Chairman Bernanke: Okay. Let me just get a sense around the table, if I could. I think President Hoenig makes the point that volatility in ]]>
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<title><![CDATA[Analysts Missing Key Ingredient of Economic Growth]]></title>
<link>
			http://www.minyanville.com/business-news/markets/articles/fed-federal-reserve-monetary-policy-mbs/1/14/2013/id/47353</link>
<pubDate>
			Mon, 14 Jan 2013 09:45:00EST
</pubDate>
<guid isPermaLink="true">
			http://www.minyanville.com/business-news/markets/articles/fed-federal-reserve-monetary-policy-mbs/1/14/2013/id/47353</guid>
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<![CDATA[The 24-hour news cycle, financial media, and blogosphere has to fill a lot of empty space, resulting in chronic information sensory overload.  The vast majority of time is spent offering interpretations of cause and effect in the markets.  It seems these days much of the focus is more specifically on the cause of monetary policy and effect in stimulating the markets.  This didn't just begin with the recent initiatives of quantitative easing (QE) and zero interest rate policy (ZIRP); it began with the bailout of Long Term Capital Management in 1998 that introduced the Fed's put option and launched the ]]>
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	<![CDATA[The 24-hour news cycle, financial media, and blogosphere has to fill a lot of empty space, resulting in chronic information sensory overload.  The vast majority of time is spent offering interpretations of cause and effect in the markets.  It seems these days much of the focus is more specifically on the cause of monetary policy and effect in stimulating the markets.  This didn't just begin with the recent initiatives of quantitative easing (QE) and zero interest rate policy (ZIRP); it began with the bailout of Long Term Capital Management in 1998 that introduced the Fed's put option and launched the ]]>
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<title><![CDATA[Is US Growth Blowing Out or the QE Carry Trade Blowing Up?]]></title>
<link>
			http://www.minyanville.com/business-news/the-economy/articles/Is-US-Growth-Blowing-Out-or/1/7/2013/id/47180</link>
<pubDate>
			Mon, 7 Jan 2013 08:20:00EST
</pubDate>
<guid isPermaLink="true">
			http://www.minyanville.com/business-news/the-economy/articles/Is-US-Growth-Blowing-Out-or/1/7/2013/id/47180</guid>
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<![CDATA[After scanning through this weekend's financial periodicals there was scant mention of this past week's most important market development that could frame trading for the rest of the year and beyond.  And I'm not talking about the S&P 500 (INDEXSP:.INX) closing at a new 5-year high.
 
On Thursday, December 28, 2012 I provided my thoughts for how the bond market would trade in 2013.  It wasn't simply a year-end yield target like most strategists issue, but rather a road map to help investors navigate what I believed would be a tough trading environment.  The 30-year long bond was poised to ]]>
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	<![CDATA[After scanning through this weekend's financial periodicals there was scant mention of this past week's most important market development that could frame trading for the rest of the year and beyond.  And I'm not talking about the S&P 500 (INDEXSP:.INX) closing at a new 5-year high.
 
On Thursday, December 28, 2012 I provided my thoughts for how the bond market would trade in 2013.  It wasn't simply a year-end yield target like most strategists issue, but rather a road map to help investors navigate what I believed would be a tough trading environment.  The 30-year long bond was poised to ]]>
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