Posted on July - 04 - 2011
Members ratchet up discussion of normalization
Meeting participants agree on broad principles for normalization process
According to today’s release of the minutes from the April 26-7 Federal Open Market Committee (FOMC), members extensively discussed different strategies for reversing extraordinary monetary policy arising from the 2008 crisis. In particular, Federal Reserve staff divided the strategic imperative into two buckets: normalizing the accommodative stance versus normalizing the conduct of policy. In turn, FOMC members focused on three issues: the optimal combination of sales and rate hikes, the degree of responsiveness to market conditions in asset sales, and a set of principles to guide the process through which policy is normalized. First, Federal Reserve staff suggested that once a time and a degree of accommodation is decided upon, the FOMC must consider the desired combination of asset sales and rate hikes as both “achieve similar outcomes” in terms of the end result on the economy. For e
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Posted on July - 04 - 2011
– The major U.S. index futures are pointing to a lower opening on Wednesday, with sentiment turning markedly negative following the release of ADP’s private sector employment, which showed anemic job growth. The data is likely to trigger anxiety especially against the backdrop of other soft data points that have been released from across the globe. Together, these numbers are likely to re-ignite growth worries and keep investor sentiment subdued.
U.S. stocks extended their gains to a fourth straight session, as they advanced on Tuesday, encouraged by reports suggesting that further help may be well on its way for debt-plagued Greece. The major averages opened sharply higher, but some selling emerged and some of the gains were surrendered.
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Posted on July - 03 - 2011
– The major U.S. index futures are pointing to a lower opening on Wednesday, with sentiment suggesting further weakness on top of the declines in the previous three sessions. The durable goods orders reports released earlier in the day could stir further anxiety, as the report suggested waning demand for capital goods-a key indicator of future manufacturing activity. The price of oil is seeing weakness and could see some volatility amid the release of the weekly oil inventory report.
U.S. stocks went about in a lackadaisical fashion on Tuesday, with the major averages moving back and forth across the unchanged line before closing modestly to moderately lower. Lingering worries about global growth following the intensification of European debt worries continued to hurt sentiment, even as a bounce in the commodity space lent support.
The Dow Industrials ended down 25.05 points or 0.20 percent at 12,356 and the Nasdaq Composite lost 12.74 points or 0.46 percent before closing at 2,746.
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Posted on July - 03 - 2011
I was at the 49 North Resource Conference in Manhattan recently, meeting with mining companies and gathering intelligence. And I heard a guy give a talk with the title, “A Mining Supercycle?”
I thought to myself: “Of course he’ll say we’re in a mining supercycle and how wonderful mining is. I’m at a mining conference, for crying out loud, surrounded by mining companies and geologists. To expect otherwise would be like expecting to find Victoria’s Secret models at an Amish quilting bee.”
Yet he surprised me. He said no, this isn’t a mining supercycle. In fact, he turned the idea on its head, and what he said folds in neatly into a bigger idea I’ve been working on. One that I think has important long-term implications for investors.
The guy who delivered the talk was Christopher Ecclestone, a mining strategist at Hallgarten & Co. Ecclestone’s main idea is that what we’re seeing isn’t anything new.
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