33 Burst results for "Paul Volcker"
The Trish Regan Show
Joe Biden Seems to Think He's "Curing Inflation"
"May see some market trepidation this week. I would expect it by the way I am not exactly what you would call a bull in this sort of economy, even though some people are like, oh, you know, it's great. Inflation is coming down. You know what? It's not. It's not coming down fast enough. We got the consumer personal expenditure index, which I don't even think is the right way to be looking at inflation. I really don't. There's some idiosyncrasies about it that would not make it my favorite metric if I were on the Federal Reserve board of governors to be looking at, but nonetheless, this is a thing that they watch, and it's at 5%, so they're like, oh, that's great. Well, let me just say, again, because it's not my favorite metric. If you were to actually look at this on an apples to apples basis and you went back to the early 1980s, when Paul Volcker had to raise rates so aggressively in order to contain inflation, what you would actually find is that we're much closer to roughly 14 percent. Inflation just like we were back then. And guess what else? We got all kinds of international problems. I mean, the balloon thing, this is a whole other level stuff, but nonetheless, back then, we had the Middle East crisis, and so as a result of that, you had escalating oil prices, which we have a little love today. We also have escalating food prices, leading us very much into a stagflationary style in environments. So be prepared Tuesday Tuesday night, we're going to hear from the president of the United States who's going to tell us, oh, everything's great. I mean, he actually is either stupid enough or delusional enough or deceptive enough to have sat there with a straight face on Friday and have said this about inflation. For any blame for inflation. Should you just the president? By taking blame inflation, no. Why not? Because it was already there when I got here, man. Remember what the economy was like when I got here? Jobs were hemorrhaging. Inflation was rising. We weren't manufacturing a damn thing here. We were in real economic difficulty. That's why I don't. Thank you. Okay, I just need to set the record straight on that. They're really irritates me. When people just so blatantly lie about things like the economy where we actually have metrics that we can go back and look at, including, of course, inflation. 1.4% inflation. That's what we had when Joe Biden came to office. But then he added his third stimulus check. I mean, we'd already had two from the federal government. I warned it was too many. Tuesday stimulus checks. Plus all that the Federal Reserve was doing, we certainly didn't need a third one, plus more money printing from the Federal Reserve. It was absolutely absurd.
The Exponential Trend Line on the Gold Price
"So here we are with our gold price curve. Again, we've looked at this so much. Don't think I need to go over the history of the last 50 years. You have the timeline there. You can check prior videos. If you're interested, but here we have the interest rates going up to 22% during the Volcker years kind of pricking the gold bubble in the United States and gold being priced here in dollars and floating freely for the first time since bretton Woods collapsed ten years prior. Gold actually peaked at about $850 an ounce for about two seconds and then in 1980 and then in December of 1980. Paul Volcker took interest rates to 22%. And then from here we had a falling interest rate period all during this period, the great moderation it was called some people called it the end of history at certain times. We had the Soviet Union ended the Berlin Wall fell. All sorts of great things for freedom, but this also happened during a falling interest rate environment, which is quite different from now. And then of course we have the global financial crisis and then gold popping back up in price. First and 2011. And again, in recent years, during COVID. So the current price as of a few days ago, December 31st, 2022, $1812 per Troy, ounce. And again, remember way back in August 1971, when many economists thought that gold would go to zero, gold was a deep pegging, the brenton Woods agreement was falling apart, the Nixon shock, the Smithsonian agreement ended. Even though they still statutorily have a value for gold on the books in the United States, there is nothing tying the dollar to gold. On the books of the United States, nor anywhere else in the world for that matter. And that all ended in the early 1970s. And then we had gold pretty much for the first time floating freely in the market. In the last 50 years.
The Trish Regan Show
We're in for a Tumultuous January...
"You're watching this market I suspect we're in for a tumultuous time, a difficult January already we're off to a rough start and what we're seeing there on Capitol Hill does not help. I mean, it's a little bit of a red herring and that they'll figure it out eventually and I don't think that the economy is going to collapse because of it. So you have to take these things in stride and know that while it doesn't look good for Republicans and it certainly doesn't make us look good on the world stage, it's not going to totally collapse these markets. What will collapse these markets are bad policies, which we've had many, and will continue to have more of. You heard me talking in just yesterday's program about gold in the potential for $3000 an ounce which one analyst over at a Danish bank is predicting, and while it's totally far fetched in many ways, the concept isn't in that you are starting to see a lot of nations around the country retreat away from dollar backed assets and obviously they can't go to crypto. So where are they going to go? They're going to go to those safe havens, things like gold which tend to perform better in an inflationary environment. Now gold hasn't performed that well, in part because you've got central banks around the world raising rates, the thinking is, oh, you raise rates, that's going to contain inflation until oops, you realize it's not containing inflation and it's not going to contain inflation if we really wanted to contain inflation. You know what we'd be doing with Paul Volcker did back in the early 1980s because apples to apples, we can talk more about it in tomorrow's program, but apples to apples, you're looking at a very similar situation, inflation wise of what we had in the early 80s, and it took a lot more than these small interest rate hikes that were getting right now to get that under control. So
Bloomberg Radio New York
"paul volcker" Discussed on Bloomberg Radio New York
"Came out and you could charge 1% on a money market fund, which is a lot to charge for something that says plain vanilla, some money market fund, but a money market fund was sure. To be a winner compared to the bank CDs that were limited by regulation to 5% interest, then Paul Volcker was driving the interest rates up to 8, ten, 12, even 14% on money market instruments, all you had to do was some money market fund manager is buy the standard stuff. Treasury bills, commercial paper, and the like, and you could put together a portfolio that's producing a very high income and the banks that had all the money were limited that at 5 and a half percent. So then when they float out of the banks into mutual funds and Vanguard made itself obvious choice by having slightly lower thieves and then lower fees and then lower fees as their assets built up. So they had low fees for identical product. And you don't have to be that smart to figure out, hey, wait a minute. These are identical products, and one is low cost, why not? So let's also talk about what was then thought of as a fairly radical concept, neutralizing the mutual funds, business, tell us a little bit about that idea where, instead of being profit driven, the profits would eventually flow back to the owners, the investors and the funds through lower fees. We've just said it beautifully. Well, you know, I the proposition. I've been educated with this book, so it's deep in my thought process. Well, you know, once you get two and two is four, it's easy to remember and put to work, but the secret here over and over and over again is ferocious drive to not fail. Which was Jack. Ferocious drive to be recognized as mister wonderful, which was a very important part of Jack bogle, all through his career, but it gets more and more and more important as he got deeper into Vanguard. Those two phenomena show up over and over and over again. Coming up, we continue our conversation with Charlie Ellis, author of inside Vanguard
The Dan Bongino Show
Inflation Isn't Getting Any Better Under Biden
"Things haven't gotten bad enough yet But they are They're getting there now They are None of this is going to turn around They did a whole show on it yesterday The economic segment at the end of yesterday's show it's on my podcast if you missed it I laid out clearly how none of this is going to get any better This inflation crisis even Biden's really hesitant to call this a mission accomplished moment not inflation's ebbed a little bit because we've seen this before folks Just go back and look at what happened in the late 70s and 80s You remember that gym inflation would be 10% then they'd ease up a little bit to go down to 7 Oh we did it Back up to 10% They have a little bit They would ease up on the back up again to ten It wasn't until Paul Volcker came in and said I'm done with this inflation stuff And just destroyed it with interest rates Basically shut the economy down making money so expensive That he basically dried up the money supply and then Reagan juiced the production side of the economy to create more products which is the smarter way to do it by the way It wasn't until then we crushed it But they're going to crush the economy And they are going to crush the border while we're at it They're going to take advantage of the next two years
The Trish Regan Show
A Looming Market Disaster
"Let's start here off the top with the inflation news. The inflation news really coming in. I've been anticipating higher than people thought. What we saw is that wholesale prices that the prices producers I should say not consumers pay for goods, rose, three tenths of a percent in the month of November. You say, oh, you know, that's not a whole lot. Well, it is because you see this stuff starts to compound. So in reality, we're up at 7.4% from a year ago. Well, that, that's a problem, because it shows you the inflation is not coming down into the four, 5, 6% range, like Joe Biden and company, and the Federal Reserve would like you to believe it is. It's not happening. And I suspect that we're going to have a whole lot more inflation for a longer time than anyone anticipated in part because of what I've said before. When you look at the inflation numbers on an apples to apples basis or oranges to oranges, what you see is we're looking at inflation that is very similar to what happened in the early 1980s and inflation at that point was up around 16 percent. When you use the exact same metrics because you see they've changed the metrics because they want inflation to look a little bit better. Well, when you use the same metrics, what you find is we are exactly where we were. What do we do back then? We had Ronald Reagan and Paul Volcker saying, okay, it's time to batten down the hatches, and we raised rates considerably drastically at a really fast clip. That's not happening right now, and I don't see any will to make that happen, and thus we're going to be in this sort of no man's land of higher prices, higher prices, higher prices for a long time, all that stuff starts to compound. I mean, you look at gaseous number, 38% surge in wholesale vegetable prices. That's incredible. And so wholesale prices for food are up 3.3%. So if your local restaurant is changing the menu price is pretty often, you can understand why. Because they're having to pay more for the goods that they're getting in to make your meals unless they need to charge more for those meals. You see how this affects consumers. And yet consumers aren't really making enough in terms of their salaries to justify these higher prices.
The Trish Regan Show
Everyone Is Keeping an Eye on the Fed and Inflation
"Financial front, as I said, we had a great discussion today about inflation. I think it's going to continue on. I think that the fed, everybody's watching, of course, Jerome Paul very, very carefully, but I think that the fed is really not going to have a choice but to continue. It's aggressive interest rate stance. It's frankly not aggressive enough from my standpoint, only because I'm looking at the inflation that we have today. If you look at this on an orange to orange basis or apples to apples, basis what you find is that inflation is much more like what we had in the early 1980s. In other words, when you use the same metrics that they used back in the early 80s, you find, you know, we're right there. We're like 15, 16%. Inflation. So what happened then, Paul Volcker stepped in, you had a major effort there and a coordination, frankly, because I don't think he could have done it without Ronald Reagan going for it. And so that was a testament to the leadership of Reagan as well that they were able to come in there and actively move on interest rates in a very aggressive way. You don't have that happening right now. And thus, there's so much money. And
Real Estate Coaching Radio
"paul volcker" Discussed on Real Estate Coaching Radio
"I don't remember what O and R stand for. Yeah, but the now essentially the government controls that the interest rates are. So you're dealing with the fact that the government can more or less directly control what mortgage interest rates are and you're going to see a lot of pressure for if there's any sign of deflation. The fed said this basically. Any side deflation or meaningful unemployment, they're going to stop with the rising of the rates. Right. And then the uncertainty will leave the market as well. But let's go back to the alcohol versus money printing analogy for Morton Friedman. That just is going to protract drag out the recovery. It's not going to be that we don't still have a problem. It's just going to take a lot longer for us to get over the problem. And what Paul Volcker did in 82 is he said, well, look, you know, to this point where you're just saying that people are projecting rates are going to go down after the inflation sorted itself out in 18 months. I was thinking to myself, that sounds like some bullshit. Because the last time we had anything that was similar to this, it was over ten years. The inflation last time we were in a situation that was similar to this, lasted from basically the late 60s all the way to the early 80s. And then it took Paul Volcker Volcker to effectively raise mortgage interest rates up to 20% and that was what broke the inflation's back. That actually is what it took. Just the sobering up part. That's what I'm trying to express. That's the sobering up. And if it takes something like that, will this government will this fed, will they have the courage to do it? Will they be willing to do it? We don't know. Do they have the political power to do it? Exactly. But here's the big difference. And I know we're getting very nourished on this. But again, this Julie and I really do try our best to study all this information so it can be great coaches to all of you. The reality of it is that the biggest difference between the early 80s and now and the reason that the fed really can not continue to rise interest rates is because when they raise interest rates, they're also raising the debt service on the interest rate on the national debt. Themselves essentially. Essentially. So the national debt now is over $30 trillion. I heard several people talking about this on different podcasts that if the fed raises rates to 6%, the fed rate is 6%. Mortgage rates will be easily 10% if that happens. So if the fed raises their rate, it's right now at 4%. You can buy a treasury bond for something like 4%. If it goes to 6%, which again people are projecting, something like a third of the amount of money that the U.S. government collects per year in the form of taxes, obviously, will go to the debt service. We'll go to paying the bondholders. And will that happen? So what's that going to mean? If all of a sudden all a third of all the revenue or income, the U.S. government takes in, has to go to paying debts. What are they not going to pay? That means entitlements aren't going to happen. That means you're going to see all kinds of suggested cuts and social security and all these other things. Other problems will arise. Do you guys think that's going to happen? No. No, I don't think so either. So the problem we have now is that unlike the early 80s, we don't have in the early 80s.
Bitcoin Magazine Podcast
"paul volcker" Discussed on Bitcoin Magazine Podcast
"We have pins and trade wars happening. Currency wars happening. Everything's happening. We also have the fed hiking interest rates like crazy yet. Somehow the economy is not falling apart. It's doing quite well. So that's why I'm saying that the fed will stop eventually. The market knows the fed will stop. The fed will not raise like Paul Volcker, you know, up to 20 up to 20%. They already tell us that they're going to stop after December or in the very first few months of 2023. So the market is looking ahead past that. So they're seeing that the economy is quite bust right now. And that the fed is about to stop. So that's why I think that things are looking strong. I'm bullish on stocks on bullish on Bitcoin and a lot of people don't like that. That is definitely the contrarian view out there. So yeah. The thing that's hard to square with that is the three month ten year inversion because when yields are inverted, that means that typically a signal that there is going to be a recession coming. We already had a recession in the first two quarters of this year, and we talked about that many times on the show. I think we had a recession back then. Q three has come out now. And it was 2.6% positive annualized for Q three GDP. That's a pretty big number going from negative to 2.6%. So how do I square that all with a good economy, the stock market is fairly strong. Bitcoin is not falling off a cliff, Bitcoin is actually inching its way upward, but the yields are inverted. Well, I mean, we could just have mild recession. So maybe Q four is negative in Q one is slightly negative, but then two in 2023 is back positive again. So we don't have to have a very negative like hard landing. We can have just a mild back and forth between negative and positive real GDP. Two caveats to that. I do know that GDP is not a good measurement. And within GDP, real GDP, you also have inflation measurements. So you have two kind of subpar variables that you're trying to tease out to see what growth is. So overall, I think that it is the best measurement that we have. And it does fit in with my general theory that we are going back towards a post GFC normal of low inflation and low growth. I mean, we could see what happens if we see two years of quarter by quarter bouncing between negative 1% and 1%. Negative 1%, 1%. That's going to feel like a recession. Definitely 100%. It's going to feel like a depression because not having any growth, especially all the way back since the great financial crisis, basically, we've had very low growth. That it's really bad on the psychology of society and it can feel definitely like a depression. Now that's the U.S., but that doesn't account for European countries for Asian countries, South American countries. There could be all sorts of stuff happening where they go through massive recessions, but the U.S. kind of skates by with this around 0% growth. All right, enough of that. Does that answer the question CK? Very in depth answer Ansel. Let's jump into the dollar chart. Okay, so this is pretty much well, I have two more charts when we talk about oil or diesel.
Bloomberg Radio New York
"paul volcker" Discussed on Bloomberg Radio New York
"That period when Paul Volcker had to work so hard to get inflation down. Paul Volcker also had to realize that he stopped hiking rates too quickly because they slowed down. Glacial went back up. They had to come in even harder and J Powell, particularly mentioned, not moving prematurely. So don't be looking for a pivot any time soon, investors. I think also important here that he's going to look at the totality of data. Charlie Evans from the Chicago fed, who was known as more of a dove, said that he could see his way clear to a 75 basis point rate hike. He's not made up his mind yet, but one thing for certain I love the sauce leader. He said, I know grace have to go a lot higher from here. So that's what they're seeing. I think Christine Lagarde is acknowledging it. The question is, what is a lot for Europe? What is a lot for the U.S. that definitely the economies are in somewhat different situations. But the path for the policymakers is the same. And they're making it very clear that this is what they intend to do. And it's probably not going to stop anytime soon. Don't look for a pivot anytime soon, global economics and policy at a Kathleen Hayes in New York, thank you. Let's bring in Eddie Lowe of maybank group wealth management. And he could have you with us. I guess the key issue coming months is whether the fed will keep hiking under we're seeing inflation below 2%. Right. I think when the market is valid in July and early part of August, we thought that investors were premature to price and effective. And I think power was Jackson hole speech has actually reinforced that view, right? So moving forward, we think that all eyes will be on the upcoming CPI data. And I think that is likely to go up with a 75 basis point rate hike. But having said that, I think the high expectations are now more recently priced in. What is not priced in right now here is really on growth expectations, especially for corporate earnings. And that could actually be another trigger for the market downside. So some suggesting that perhaps August, the sell off in August, takes us closer to the bottom, you're suggesting perhaps that's not the case? No, I don't think so because you know, wow, you know, the S&P has actually pulled back about 10% from the recent peak. That actually is adjustment of the rate I expectations. But if you look at the consensus forecast for S&P 500 earnings, we are looking at 9% for this year 8% for next year. And we are talking about increasing probability of a recession. So these kind of high single digit earnings growth, that seems to me a bit over optimistic. How are you positioning your portfolio? We are still pretty defensive in our SI location given the many macro uncertainties out there. So underweight equities, very selective, just overweight on Indonesia. But fixed income we are actually incrementally positive. So open more cash or not. Still, very much over bit cash still. But you know, credits wise, investment grade credits. I think that's a source of defensive carry still. Just take a look at these lines that's coming through from areca corot of course. BJ governor talking about fumio kushida saying he didn't have any particular request, but he did say that the rapid weakening of the yen is undesirable. This is just coming through the moment. These are the lines that come through from the BOJ governor, but I don't get a sense of what
AP News Radio
Powell: Higher rates won't likely cause deep US recession
"The Federal Reserve's chair says higher interest rates are unlikely to cause a deep U.S. recession Inflation is the highest in 40 years and the fed has been boosting interest rates at the fastest clip since when Paul Volcker and the Central Bank jacked rates to roughly 19% That triggered a deep recession and sharply higher unemployment This time fed chair Jerome Powell suggests the Central Bank won't have to go nearly as far We think we can avoid the kind of very high social costs that Paul Volcker and the fed had to bring into play The fed's expected to announce another big hike in two weeks speaking at the Cato institute Powell did not signal the next move but said the fed is determined to do what's needed to lower inflation Until the job is done At
Bloomberg Radio New York
"paul volcker" Discussed on Bloomberg Radio New York
"I have no idea what we're gonna do with this next segment, so I'm gonna throw it to you. Well, I have been waiting for at least a week to get Neil Grossman back in here. Since the fed decision, he has worn many hats on Wall Street as a prop trader at JPMorgan. He took risk for the norges bank, the Central Bank of Norway. He ran a hedge fund. Yeah, for sure. I told you he was in Norway. The road for Cambridge. I saw a great picture from must've been the 70s. Really? Over the weekend. But now he is a vintner and an historical fiction author. Neil Grossman joins us in the interactive broker studio. Neil, I want to get your take first on the fed's inflationary goals because they already were aiming for 2%. A lot of people have a problem with that to begin with. But now we've well overshot that and if we ever want to get the average back to 2%, it's going to take years. Well, let's start with why you should get the average back. Yeah. Mister Powell and before him, mister Bernanke spent a lot of years explained to us that having inflation a little under 2% was not really good. Despite the fact, of course, that this statutory mandate is actually zero price stability. That's just what Congress says. They can do whatever they want, right? Well, we can argue that too. Yes, they do whatever they want. That's not really the idea. But they spent a lot of time and then arguing that they wanted to let the economy run a little hot to push up inflation over to so you could average it. So let's using that as a baseline now that the fact is is that they let it run amok. To get it back to a 2% average, let's use a reasonable time frame like ten years, you're going to end up this year probably about 12 to 14% over what the 2% trajectory was, which means you're going to really have to have inflation average like 1% for 8 years is something like that to get you even close to the 2%. And that's let's face it, kind of a pipe dream. Well, they're not talking about that. Mister Powell has said, I want to get inflation just back to 2%. And let's talk about the probability of what that takes and Paul Volcker got raised into the 20s and it took 25 years pretty much to get a stable 2% ambient environment. I mean, you had your moments down, but for the 90s, we were still averaging three to three and a half percent. That's 5 o'clock. What's on anybody's business other than Congress is? They're the ones who have to say that's not right. I actually think that there's a legitimate reason for having low inflation. It creates an extraordinarily healthy environment done right. It minimizes only Matt and I were doing some calculus this morning about how to maximize the area inside of a fixed geometrical. This is interesting. If you take, I can see doing that. Any four sided shape, right? I would have thought the area, you know, if the total perimeter around the perimeter is, say, 36 inches. I would have thought it doesn't matter. You can stretch a rectangle out, make it a square. It's all going to be the same area. It's not. A square is the maximal area, and any end gone, cube, or whatever else. The maximum area is equal size, which applies to returns on your investments, and it also applies to things like compounding of inflation. So for example, if I say to you over a ten year period, you can choose either 10% returns each year, or you can have 11% this year, 9% next year, 11% of the year after that 9% that year after that 11% that you're after that 9%. You're much better off choosing 10% each year. Okay. In fact, there's an R, I would take the ten inch short 11 9 for eternity and I walk away richer than Bill Gates. But the point is this applies to things like what the fed should be doing to manage the economy. The fed should find reasonable trajectories of GDP, inflation and everything else. And even the stock market and you want to find a sustainable trajectory where you're minimizing the variability, minimizing the volatility. That's actually how you get the maximum long-term. But in their mind, is that I don't think that well, their mind, well, 2% is an interesting issue. 2% is a two factor optimization. They have two mandates, employment, full employment and price stability. And they're not totally consistent. So 2% has become their sort of maximal of both at the same time. They beat that. That was the sad thing. They were ahead of that. About 8, 6, 7 years ago, they didn't like that. All right, as my first sales manager, pain Webber would say, after I went through my big pitch about what I wanted to do with media stocks, he would just interrupt me and say, Paul, are we buying them or are we selling them? What are we doing here? Well, last time, two times ago is on I was short. I went a little long, and yesterday I started going short again. I think the market's got a lot more dances. And by the way, I think this is also quite healthy. You need sort of a washout to equilibrate, and that without that, I think we're going to have a lot more volatility going forward. I think you need to just get some of the energy out of the system and then I think at least for a while, you can be quite positive I remember yesterday I was telling you, Neil, Neil's target for the S&P at the end of the year is 17%. No, no, no. That's my target probably next year. Next year. Or whatever. What? 1776. We're trading at $4000. But think about it. I am a patriot. I get it, but you do honestly think that we're going down. I think we're going down and I think we're going to go down a larger than people. Partially because once you start to go down, because the markets are still functionally long and over invested, the fact is that people have to be forced out and to reduce their exposure. And when that process happens, markets extend an overextend. So you can pick what you want. I think the earnings are too high. That's the I think that the bottom line is that the PEs are too high. And again, going back to one last thing, interest
The Pomp Podcast
"paul volcker" Discussed on The Pomp Podcast
"A huge part of their policy kind of decision making process as they try to actually signal to the market. What to think. How is that played a role in the kind of economic growth or economic strength of the United States? Well, she used to be the coin of the realm for the Federal Reserve. It was not unlike the Supreme Court. We'll tell you what our decision is at some point, but or you can figure it out, but basically when the Federal Reserve didn't do before, was tell you what they were going to do in advance, and they didn't explain it after they did it. When Paul Volcker was the chairman of the fed, they would just one weekend increase interest rates, federal discount rate by 200 basis points. They didn't explain in advance or didn't explain afterwards. You had to figure it out. Today, everybody believes that transparency is a greater virtue than secrecy and therefore the fed telegraphs exactly what it's going to do. And then after it does it, it explains it in great detail. That's much different than it was 50 or a hundred years ago. And it does give you information that can guide what you're going to do in your investment process. Do you think that it's a positive on the market or do you think that actually it was better off when people were forced to do the work themselves and figure it out? When you had to do the work yourself, only a limited number of people probably had the expertise to figure it out and therefore it was an advantage to those limited number of firms or people that had expertise in that area. Today, the theory is everybody should have an equal information and therefore everybody will have an equal opportunity to benefit or not benefit from what the Federal Reserve is doing. On the whole, it's hard to be against transparency. So I think it's a good thing. And I support what they're doing. I think Jay Powell has done one other thing. In addition to explaining and telegraphing what he's doing, he tries to do it in the king's English. In other words, many of chairman of the fed used to speak in what's called fed speak, which is almost incomprehensible to the average person. So you didn't really know in many cases what Alan Greenspan was actually trying to say to you because he talked into kind of what's called fed speak. Now, J pal, tried to speak in English and therefore, it's much more easily understood by the average person. Yeah, one of the things that fascinates me about central banks in general, but the Federal Reserve obviously is the one I think most people in America will pay the most attention to. Is they are making decisions based on data. And as I've learned more and more about the datasets they use and the
Bloomberg Radio New York
"paul volcker" Discussed on Bloomberg Radio New York
"Wall Street and Richard Salomon. And I'm Brian Curtis here in Hong Kong alongside rich and we're looking at markets opening in about 90 minutes and Sydney Tokyo and Seoul and then three hours out we'll get the Hong Kong and China market starting to trade. Futures up a little but really not too much happening at the moment. We'll track these markets for you. And we'll get to the next report in a few moments. Richard. And Julian Robertson are the billionaire founder of Tiger management has passed away a long time, a spokesman for Robertson said it was due to cardiac complications, Robertson was one of his generation's most successful hedge fund managers at Tiger by the mid part of 1998 assets had sought to about $22 billion however in 2000. Robertson announced the closure of 6 Tiger funds and that was after watching assets dwindled from 21 to 6 billion in 18 months and that was because of losses and investor withdrawals. Afterwards, Robertson served as mentor to a wave of investors dubbed fondly as the Tiger cubs that are a group of former Tiger management employees who have since founded their own hedge funds. Here's Robertson in a 2016 interview. If you take a long period of time, it's been pretty good to. Stick with a lot of the very good hedge funds that are out there now and I certainly have most of my money that I don't manage myself with frankly the Tiger cubs. Robinson was known for his strong personality and extensive network of advisers. He was 90 years old. The message from markets this past week has been that the fed chair Jay Powell will channel his inner Paul Volcker at Jackson hole this week, but Goldman Sachs chief economist Jan hatzius says not so fast. He tells us that he thinks the fed will deliver a rate hike of 50 basis points in September. And here's more of what he had to say about what Jay Powell can be expected to push forward at Jackson hole. I don't think he'll be specific about the number, but I do think he'll be saying, you know, there is a risk of over tightening, therefore it makes sense to go a little bit more slowly than this really outsized increases. But at the same time, he'll make clear that the job is not yet done. Inflation is way too high. They're very committed to bringing inflation back down to 2% or thereabouts. So I think it will be a balancing act. Asia said he anticipates the fed fund rates of 3.5% or more to break inflation. And we'll hear from the fed chair, Jerome Powell, 10 a.m., Washington time on Friday. All right, let's take a look at the markets now. We mentioned that we're trickling a little bit higher here in the Asia Pacific. I don't know, can you trickle up? Hank's hang index futures of a tenth of a percent. Edging higher. FTSE, China a 50s up about a half a percent. And Australian futures in Sydney up two tenths of 1%. And just a handful of points in it for the nikkei futures 28,465. The close yesterday 28,452. We did see weakness in the dollar overnight. The dollar dropped about four tenths of 1%, dollar yen, one 36, 70, and the Euro at 99.7 U.S. cents. We got some weaker economic data in the U.S.. There was housing data that was weak and also business activity. New home sales dropping for the 6th time this year, and that was the slowest we've seen since 2016. In the bond market, ten year treasury yields rose three basis points to 3.04%. Directors at two fed branches, St. Louis and Minneapolis, favored a 100 basis point increase in the discount rate back in July. Now the fed eventually lifted the discount rate and the fed funds rate by 75 basis points. Discount rate votes can be symbolically important as a sign of preference for how the fed rates shall fed fund rates should move. Briefly, gold is trading at 1760 a little bit weaker, WTI crew here, 93 67 a barrel, Rashad. All right, the time approaching what to 25 minutes to the top of the hour. Two of the largest states in the United States holding their primaries with some critical races at stake, let's get to Ed Baxter. We've got global news. Yeah, exactly right, rich
Bloomberg Radio New York
"paul volcker" Discussed on Bloomberg Radio New York
"For good economic news today, was that the U.S. unemployment rate fell to its lowest level in nearly four years, 5.7%. And for anyone who still hasn't got the message that inflation is the big problem, the index of wholesale prices took its second straight 7 tenths of a point monthly jump. The great Lewis Kaiser filming Wall Street week in 1978 from the sticky shower on, I think. That was a great moment of what mister rudkin did here and it speaks to 1978. And Lisa Brown, it's not of Bob Seger or the moment, but it was, and I'm sure Lou would agree. It was the dismal 70s. This is not the dismal 2020s. But this week, we got a number that was close with the 9.1% inflation shocking markets. And we can not avoid the rhyming aspect of that, even if this isn't the 1970s. And one of the things under the radar this week folks so important is compare contrast of Jerome Powell with Paul Volcker. I got some major heat from Wall Street pros. Maybe lose that tone and just start looking at where we are right now. Where we are as the lord Kelvin and David Bianco with RBC capital markets and DWS thrilled they could start us out here on the state of where Wall Street is right now. Laurie, I'm going to go to you because you are exquisite. It's something no one talks about anymore, not the Red Sox middle relief, but small cap stocks. And the answer is small cap stocks do nothing, and then about every 9 years, boom. Are we close to the small cap boom and why? Small caps are in a holding pattern right now versus large cap. I think they're waiting for their moment. Like what? 7 years? Well, they actually have had a terrible last year and a half. And actually, they've been bad for quite some time. But I think really around 2014 was kind of the last moment in the sun that we had there. But look, I think small caps are telling you that this is a market that wants to start bottom fishing, where people are starting to look for things that have been de risked. And when I talk to investors about areas of the market, then they risk small cap is the number one thing that looks like. But are they small cab because they're zombie companies or because they're managements do not merge into mid cap size? What's the pixie dust of widely underperformed? There's a few different there's a few different versions of it. There are the younger growth companies that are still up and coming. There's some that have been older and fallen on harder times. And then there are others that are simply a little too niche and haven't gotten scooped up yet. So there's a big variety in there. David, a lot of this hinges on inflation getting back to 2%, so many people believe. And this is the distinction people are drawing from the terrible 70s saying this is different and it is less entrenched than some people fear. What is the risk that that's not the case? Or is it a screamingly obvious argument that the fed will get things back to where they want it? The third world do everything it can do, but it may have a bitter medicine for the economy. So I do think it's instructive to look at the 1970s and try not to repeat those mistakes. It's early in the 2020s. From 1975 to 1979, real GDP growth was 5% plus. So real growth is not going to be that strong in the United States. It's really important that inflation does work its way back to the fed's target of close to 2%. That's going to require the fed doing its job, fiscal discipline, and most importantly, our renaissance once again, like in the early 1980s of the supply side. Reaganomics combined with monetary medicine has laid the seed for a very good 80s and 90s in thereafter. So we need to learn the lessons of the 70s and that repeat the mistakes. Meanwhile, as people do bottom fish and Laurie says there's evidence from the small caps. How much are bonds participating in this? How does the stability in longer duration bonds provided a template for that bottom fishing for that comfort that could even persist longer than people think? I think investors are better off for now. In short duration bonds, treasury bills, two, three year treasuries. The bond market is not priced for the fed getting to as high as 4%. And 9 is the equity market. That would be a risk. So I think investors should be careful with this bonds, look for inflation protected bonds, hold on to cash. And then look for real assets, whether it be stocks or real estate or utilities. I do like, I do like small caps and I do like banks for those who are willing to take the cyclical risk. I think small caps have been beaten up even more so than the large gaps. And what's interesting about small caps, they were held back over the past decade or two from globalization and other factors. They would benefit from it. So we got a problem here. I guess agree with each other. We agree. Okay, well here, I think. They agree. That's right. That's why we're put on the couch together. I do wonder, though. When you were all talking about the United States, we have to zoom out. It is not about the United States right now. It is strong. In the United States, in Europe, it's another story with gas. And we are looking to the ECB next week. We are looking to the Nord stream one pipeline, whether it will come back online. We are looking to emerging markets, Tom has been talking about it all week, and some of the crises percolating in pockets throughout the entire complex at what point can the United States fall subject to what's happening outside in the rest of the world, Lori. Well, look, I think we had a template for this back in 2018. We spent most of the year thinking the U.S. would be immune from the risk global recession that would emerge from the trade war. And then recession fears came home to roost in markets fell sharply. But we've already done that at this point in time. So I think we can go back to this idea of a relative game. Will Europe be worse off than the U.S. if the U.S. is better off? I think there's a limit to the amount of cash that institutional investors in particular are willing to sit on. A lot of that money is going to find its way into the U.S. and the small caps. David, I want to go to the heritage of DWS and of course the relationship with Deutsche Bank and the giant David folkers Landau who won February 24th or 25th told me watch the dollar. This will need to be amended. We are now living a dollar surge. And I'd say this week folks DXY, the blended large nation index was caught up with late in the week by the Bloomberg dollar index more EM. David, how do our listeners, how do they adapt to an incredibly large, strong dollar? It's a tough thing to adapt to. Don't forget the S&P 500, not banks, but the rest is a very global set of businesses and they're facing foreign exchange rates. And they're going to be facing tougher competition in the areas of auto and machinery and tools from Japan, incredibly weak yen. And Europe. And it's a slower global economy anyhow. David focus Landau from Deutsche Bank was one of the first to warn of a recession coming, and that DWS, the
Bloomberg Radio New York
"paul volcker" Discussed on Bloomberg Radio New York
"The gloom of a recession. Do you invest now expecting out past a recession or are we just bathed within the gloom of the moment? Well, look, as my grandmother always told me, forewarned is forearmed. So this is the part of the cycle that we're in. The reality is that we've had 11 recessions since 1950. We have spent 14% of the time in a recession, they do exist, and I think that they tend to occur 100% of the time in the aftermath or amidst the A-fib tightening cycle. And when you consider that between the balance sheet and what the fed says it's going to do, we're talking about 425 basis points of de facto monetary policy tightening this year. That is Volcker like. You know, if you want to go back to his previous testimony in March, the senator Shelby, not once but twice, how compared himself not to burn and not to Miller, but to Paul Volcker. So tell me, Paul Volcker, we had double digit inflation. And Volcker killed inflation. How by two recessions separated 6 months. Can Jerome Powell use the same tools as Paul Volcker or are you in the camp? It's just so different this time around. Well, I don't see how it's different this time around in terms of how the fed influences demand. I mean, we've seen that recurringly in the past. That's not something new. Every recession was caused by excessive monetary policy tightening. In fact, what's very interesting is that even the people that come out and support of the fed, even like former fed, chairman, like Ben Bernanke, as an example. But of course, how are these former fed alumni going to vocal their opposition to the fed in terms of being way too aggressive right now? You see the fed has swung the pendulum from over easing to over tightening. We've seen that in the past. Tom, in 1997, Ben Bernanke penned a scholarly report showing that it was never oil price shocks that caused recessions in the past. It was the fed's overreaction to the oil price shock that caused the recession. Are we seeing an over our real time? David, are we seeing an overreaction right now? I mean, Paul and I are living every day, the blather almost the heat, the emotion of inflation OMG, airfares, OMG, grocery stores, OMG. That's what chairman Powell is going to hear from the senators and hear from the gentleman in the gentle ladies of the house is well. Is he overreacting is there a risk of that? Yes, answer is yes, Tom. This fed is focused exclusively on coincidence and lacking indicators. I mean, his favorite palace favorite labor market indicator hello. Or job openings from the jolts data, which don't even have much of a history or really a correlation with anything. You couldn't think of a softer number. And everybody just follows that. Job openings up openings to unemployment. It's surreal. And then he focused on headline inflation, which along with the unemployment rate is the laggy ist of the lagging indicators. So he's focused on headline inflation. Meanwhile, every recession, including the three that we had in the stagflation 1970s, let me tell you, there has never been a period where recession did not cure the inflation L now, what happens in the next cycle when we get the economy back on track when inflation does and global supply chains and unionization. So on and so forth. Well, that's another day, but recessions have always cured inflation. And I said before, that how you can possibly say the economy is strong, looking at negative 1.5 Q one, zero Q two, that's the Atlanta feds now cast. And then the conference board just told us we have a three peat of a negative reading on the leading economic indicator negative for the past 5 months, which has only happened in a recession or in the lead up to a recession. All right, I'm going to get to see the questions. I actually get out of the inflation call. Let's talk about the real economy. Mister chairman, all of this evidence on leading indicators are leading to a different conclusion of forecasts than what you published last week. Can you please explain? Well, the headlines were the strong economy Paul. I want you to go to that in a moment with mister Rosenberg down negative two 79 SPX negative 27. NASDAQ, a lesser percent down than those two indices Dow down 1%. The vix 30.25. It's not as grim a tape. No. Well, now as it was three hours ago, I should note dollar weakness off the release of those headlines. It's fractional, but we'll go in one 35 86 Paul with David Rosenberg and the real American economy. And David, let's go to that real American economy. A lot of folks are saying, you know, we're probably like, I'm gonna quote Danielle di martino booth from quill intelligence. She feels like we are already in a recession. If we are in one or heading into one, what camp are you in in terms of how deep it may be, how shallow it may be? How do you think about that? Well, that's really the unknown. It's going to be. David. David, I'm going to have to interrupt. Now, from the Senate, the chairman of the Federal Reserve, here is Jerome Powell. I'll begin with one overarching message. At the fed, we understand the hardship that high inflation is causing. We are strongly committed to bringing inflation back down and we're moving expeditiously to do so. We have both the tools we need and the resolve it will take to restore price stability on behalf of American families and businesses. It is essential that we bring inflation down if we are to have a sustained period of strong labor market conditions that benefit all. I will review the current economic situation before turning to monetary policy. Inflation remains well above our longer run goal of 2% over the 12 months ended in April, total PCE prices that's personal consumption expenditures prices rose 6.3%
Bloomberg Radio New York
"paul volcker" Discussed on Bloomberg Radio New York
"The integrity of elections is all put to question We have a lot of things that are making people feel uneasy And so to sort of get a handle on this I talked to a number of researchers including economists who think about behavior And they're saying that when people are afraid they tend to be afraid of everything and that being afraid of one thing if you have multiple sources of discomfort it actually sort of makes you feel even worse And so right now it's very real to say we do have rising prices So we do have inflation But at the same time people feel uncomfortable about government They feel uncomfortable about safety of guns and safety of schools and all of a sudden it means that you're pushed to the end where you sort of think everything's going to hell And so there's that malaise but then the other thing that is sort of echoes off of that late 70s early 80s moment Jim is like the spotlight on policymakers and obviously we had Volcker back then and he took the country to places that we haven't gone yet but I'm curious you know in the grand scheme of things we wrap up the story yesterday in the midst of the fed doing with the fed does And just wondering what you read on the fed is in all of this and that's the story of the week really I'm in the fed is there in the position of being at least if the 70s is any guy I mean that is the one body that can bring it into this I mean you can beat inflation The problem is that the beat inflation you often have to beat down the economy to the point that the people who will love you for it will eventually hate you for it It's simply because you know Paul Volcker beat inflation but to do it he had to get a federal funds fate rate that was what 2021 point He had to take mortgage rates up to almost 20% He had to basically take unemployment up to 10% He had to basically beat out inflationary expectations out of the economy simply because everybody was sort of completely beaten down Now that's probably works as a monetary policy It's very bad from a political standpoint And it's probably going to be the reason.
Real Estate Coaching Radio
"paul volcker" Discussed on Real Estate Coaching Radio
"Here's what inflation causes inflation to go down. You can say decreasing demand. So let's just stick with that. So how are they going to decrease demand? They're going to make, well, obviously inflation is going to make everything more expensive, but they're also raising the interest rates. Raising the interest rates will obviously curtail people wanting to purchase things. To a certain extent, not yet happening in housing. But the reality of it is in 1981, the interest rate on a mortgage was about the same. This is important. Rate as the inflation rate. It was around 18%. True. And what you think about what I just said. So Paul Volcker, who you hear that name a lot. He raised the interest rates to essentially equivalent to what the inflation rate was. Turns out that is the secret sauce to getting the inflation rate to fall because people, when facing down an 18% mortgage, sure, plenty of them still purchased homes, but a lot of them said, heck to the no. Now, here's the biggest difference. There's many, many, many, many differences between 1981 and now in the United States. Number one, in 1981, the United States was the biggest creditor nation in the world. In other words, we are the one doing most of the lending to most of the other countries around the world. Now we are the biggest debtor nation in the world. The amount of money that the United States owes to essentially essentially debt just to simplify it to its lowest common denominator. And mostly to foreign countries, is at the point where if the fed continues to raise rates, they also have to raise rates on the interest rate that they're paying on the debt. What's going to happen and this is an interesting statistic I heard. The United States last year collected $4 trillion in income taxes. If I'm boring you I'll go over this point quick. And if they raise the rates to 10%, and many people believe the incurrent inflation rate is far greater than 10%. But if the fed raised rates to 10%, that would make it so that three of the 4 trillion would go just to nothing but interest on the debt service..
Real Estate Coaching Radio
"paul volcker" Discussed on Real Estate Coaching Radio
"Now what's going to most likely go on with interest rates? And Julie and I have been paying a lot of attention to this. Interest rates probably can't go up much higher than they are because so the fed's going to have to make a choice. Here it is. They raise rates to whatever the actual rate of inflation is. So the way that traditionally it's been done, like going back to Paul Volcker, let's say, where you have to raise the rates, you have to raise in order to slow the inflation rate down. You have to raise rates in the same rate that the inflation rate is. So back then it was 18%. That is mind boggling to think, but guess what? Mortgage rates for that high back then too. So in order for the traditional way of approaching rising rates are inflation is to rise rates to the same rate of inflation. Well, they can't really do that now, otherwise it'll cause something probably akin to a depression. So it's most likely going to happen. Is there is going to be a point in which they can't raise rates any further. Now, this is what I've started noticing in the news. Is that you're starting to hear the fed seemingly take a victory lap. We are starting to see the signs that the rising rates are going up. We saw mortgage applications for purchases of fall. We've seen all these other types of things happening. So what's going to then happen is the rates are going to level off. They're not going to raise rates anymore because they're going to say the R fight against inflation worked. It caused an economic slowdown right in the tipping point of a recession. We don't want to cause a recession, so we're not going to raise rates anymore. Right there, that's what I'm predicting is going to happen. And that's based on spending way too much time on this truly nerdy stuff. Exactly. So we don't think. Julie and I do not well, I can't speak for you. Do you agree or disagree?.
WNYC 93.9 FM
"paul volcker" Discussed on WNYC 93.9 FM
"Just for the taste of it Yes there was a time before Diet Coke and that seems like a very long time ago but Scott how close are we to living through all that all over again Kelsey what you have to keep in mind is that in 1982 inflation was actually coming down It had been much higher almost twice as high in 1980 when annual inflation peaked at 14.6% last twice as high as it is right now And back then inflation had been high for the better part of a decade Richard Nixon Gerald Ford Jimmy Carter had all been dogged by high inflation and by the time Reagan came into office Americans had kind of gotten numb to prices that just kept going up and up Now we've just had two years of back to back double digit inflation 13.3% in 1979 12.4% last year The last time this happened was in World War I So by the standards of the 70s and early 80s today's inflation rate actually doesn't look that bad So it was coming down how did policymakers get control of inflation back then Well it was pretty painful medicine delivered by the Federal Reserve Paul Volcker who was appointed fed chairman by then president Carter was determined to break the back of inflation and he was willing to push interest rates sky high to do it to give you an example in 1981 mortgage rates soared to 18% As you can imagine that was pretty unpopular angry home builders scrawled protest notes to Volker on the backs of wooden planks but the fed chairman stuck to his guns Here's Volker speaking to the McNeil air NewsHour At some point to stand it's gonna break and the psychology is going to change Now some people might think we're looking at a repeat of that when they hear the fed is again preparing to raise interest rates to rein in inflation But the rate hikes we're talking about now are nothing like the draconian measures that Volker pursued Remember interest rates have been near zero throughout the pandemic So even if the fed were to raise rates 7 times this year to 2% or something at some forecasters now expect credit would still be really cheap by historical standards The easy money party has been going on for a long time now and the fed is not talking about taking away the punch bowl just replacing some of the really sugary punch with something closer to Diet Coke Okay so there are obviously some pretty big differences between today's inflation and what the U.S. went through in 1982 but are there still lessons from that era that we can learn One lesson is that inflation is still painful Rising prices really weigh on people's attitudes about the economy and politicians ignore that at their peril Some of the big drivers of inflation last month were the rising price of rent and electricity and groceries Things most of us can't do without At a supermarket outside of Washington Abdul tour a says his money just doesn't go as far as it used to And he has to make smaller more frequent grocery shopping trips Everything's going up inside Now we are usually buying a just couple ten I can use for two three days If I can buy for one week but now no Now that affects people's attitudes forecasters do expect price hikes to ease over the course of the year but inflation has already proven higher and more persistent than a lot of experts expected A lot of things though have changed in the last 40 years Take my cell phone for instance it has 100,000 times the memory of that old Commodore computer we were talking about Does that mean inflation is less of a threat than it used to be For most of the last few decades it did seem as if the inflation dragon had been slain It was thought that in a global economy for example workers would have less bargaining power to command higher wages oil shocks don't rattle the economy the way they did in the 1970s because the economy is not as dependent on oil as it used to be But during the pandemic we have experienced other kinds of supply shocks And when you couple shortages of computer chips and truck drivers and workers of all kinds with really strong demand well that's a recipe for rising prices You know during the pandemic both Congress and the Federal Reserve pump trillions of dollars into the economy It was an effort to kind of cushion the fallout So how much did that contribute to the inflation that we're experiencing now That's something economists are going to be arguing about for a while Those trillions of dollars did help to fuel a really rapid recovery unemployment came down from nearly 15% early in the pandemic to 4% now Could we have gotten that rapid recovery without the side effect of high inflation Jason Furman who was an economic adviser in the Obama administration thinks that last $1.9 trillion Congress put out last spring did go too far even if it helped to speed the recovery and put more people back to work I would rather have low unemployment and high inflation than the opposite I think there were probably things that were better than either of those And if the recovery plan had been half as large we'd have almost the same number of jobs now and a lot less inflation But who knows Fed chairman Jerome Powell was also asked if the fed went too far He says it's going to be up to historians years from now to decide on the wisdom of the Central Bank's policies His cigar chomping predecessor Paul Volcker looks a lot better in hindsight if pal comes to his next news conference with a cigar Look out That is NPR Chief economic correspondent Scott horsley Thanks Scott for jumping in the wayback machine with.
Stansberry Investor Hour
"paul volcker" Discussed on Stansberry Investor Hour
"Even if I don't even feel like you need a long-term view, it's just, do you want to bet that way right now? I don't really think that's a good idea. I think a lot of folks, you know, maybe, what Marco, if you said that you no longer in the COVID is important camp, if you're basically the COVID camp where, you know, like it doesn't matter anymore. You know, which I am, should you nod then also have a view that inflation will peak? Because clearly COVID brought inflationary pressures. In my view, that would be like, well, nothing is the one or zero. You know, not these black and white. There's a lot of grays in between, and obviously I agree that COVID and the stimulus package just had a lot to do with inflation. But we're seeing is also geopolitical issues that are not transitory. You know, U.S. China confrontation, this new national security prerogative to build redundancy into our production lines, that's inflationary. So is the green energy transition, which I believe in. I think it's going to continue. On a sale, but it's going to increase energy prices. These are all quite inflationary big picture issues that the fed can't deal with by raising interest rates. And so I do think that, again, I think inflation will continue to be an issue. The question for me is, what is the fed wants? I highly doubt they want to return to two to 3% inflation. I think honestly sometimes at some point this year, they'll take just peaking as a win. They'll find you a term to give it to us. So transitory. But this time you'll be like, we're asymptotically approaching our mandates. You know, I'm like, oh, what does that mean? That means they're cool with 5% CPI. Yeah. Right. The goalpost will be moved until the game is won. Well, unless they want recession, that's, you know, unless they're willing to incur a recession to arrest. Yeah, so elevated CPR. I'm glad you brought that up because, you know, Jamie Dimon on their latest on JPMorgan's latest conference call. He harkened back to the era of Paul Volcker and he's this is nothing, you know. We went up 200 basis points on the fed funds in a weekend, or overnight or whatever. And he said, I think they're going to raise rates..
Bloomberg Radio New York
"paul volcker" Discussed on Bloomberg Radio New York
"I completely agree with Larry And I think you have to recognize it's a problem that was not created in two months It was a problem creator over the last two years And so it's going to take multiple years certainly to work it out I know I want to predict that we're going back to where we were in the late 70s but I was sitting in the Washington room of New York Times when Paul Volcker announced his new inflation policy and I watched all that happen And it took multiple multiple years and a terrible recession to get it out of the system So it is going to be painful And it's going to be painful for growth It's going to be painful for jobs And we do have an election coming next year which is going to be complicated So listen to The White House they admit there's inflation They still say maybe transitory And one of the things they point to is gas prices They said that's really artificially spiked it up That's leveling off Maybe we don't have as big a problem What about the difference between headline and so called core Look there's surely they're transitory elements in inflation No question about it But here's the thing David If you look at annual rates if you take this month's number and you annualize it it's 10% So a lot of that is no doubt transitory but to say that a lot of it is transitory is not to say that it's going to get anywhere near price stability on its own And there's another point which is we always talk about the things that are high and might be transitory House prices on every index rental prices on every index except the CPI are up 20% over the last year The vast majority of that is not yet in the CPI So it's probably coming Every business person I talk to says the same thing They say we're going to have much higher labor costs going forward to retain our people We're going to have higher input costs And it's kind of okay because we're going to be able to pass it on Well that's an environment where there are pressures in many places for rising prices not for falling prices You know one of the sectors that's been very benign over the last while is medical services But as you see all the nurses who are quitting there's going to be pressure there as you see all the backlogs of elective procedures from the last year or two They're going to be backlogs there So I think we're going to entrench inflation way above 2% perhaps in the 4% or even higher range unless something happens to break the current mood to break the current trend And I don't think it's going to be three rate increases or two rate increases next year I mean remember this crucially monetary policy today is far looser than it was a year ago Looser is measured by real interest rates looser is measured by financial conditions looser is measured by the size of the Federal Reserve's balance sheet So we've got looser monetary policy even as job vacancies are way up And even as inflation is.
The Peter Schiff Show Podcast
"paul volcker" Discussed on The Peter Schiff Show Podcast
"If you're a foreigner and you own us bonds because not only were you losing money as bond prices collapsed but we were rubbing salt in your wound. Because you're losing on the fx so if you're in deutschemarks or you were japanese yen and you bought us treasuries. You got hammered on the foreign exchange rate in addition to the bond loss. Well the only way we can make the bond bear market less severe less ferocious is if we exacerbate the dollar bear market so next time around the losses will be more in the exchange rate for the dollar then in the nominal price of bonds. But i think in real terms the losses for holding. Us bonds will be just as great and it's not just for foreigners is for americans who hold us bonds because there it's not the foreign exchange risk it's just purchasing power risk because prices consumer prices during the inflation. That we're gonna get this decade are likely to be much worse than what we got. During the seventies even know the seventies are used as an example of the worst inflation. We've experienced we're going to experience it even worse this time because we are not in a position to swallow the medicine that we swallowed the nineteen eighty with respect to interest rates and the bond market because of the enormity of the level of debt so given choice to pick. It's poison. I think the poison the fed is gonna pick is to debase the dollar and allow inflation to get worse rather than do what paul volcker did and allow asset prices and the economy to roll over because the degree to which asset prices will fall and the economic damage. That will ensue. In the aftermath of that policy is too great for the fed to allow it. And i think now to you have a world view of inflation of money printing. Now that you have the popularity of modern monetary theory. I think you have a lot of people that actually think that we could get away with it. You didn't that much. Economic stupidity back in one thousand nine hundred eighty i mean. I'm sure there were still some people had crazy ideas but nothing like the harebrained ideas that people have today and of course we've gotten away with printing so much money for so long. Well we just think we could do to. Definitely i think back then. A cooler heads prevailed. We realized that there is a limit to how much money we could print and that we had reached that limit and so we stopped. But at this point i think the hubris is that there is no limit and we will continue to print indefinitely shop..
The Peter Schiff Show Podcast
"paul volcker" Discussed on The Peter Schiff Show Podcast
"Of the reasons that we had a rally in the dollar and the dollar index did sell off nicely today but the main reason that the dollar has been rallying was the anticipation of this hockey speeds. That we were supposed to get today and not only. Didn't we get a hawkish speech. We got an extremely dovish speech. So the dollar needs to really surrender all those. Ill-gotten gains normally. You get a by the rumor. Sell the fact right if you had a rally in the dollar bat was associated with the anticipation of this hawkish. Speech by powell. What would normally happen in the market is when you finally get the hawkish speech that investors anticipated in priced into the market. You get a reversal by the rumor. Sell the fact well. In this case the rumor was false because the fact was the opposite of what was rumored so this should have been an even bigger sell off in the dollar and even bigger rally in gold and gold stocks than the one we got today. And i'll talk about that a little bit later in the podcast for now. I wanna stick on the topic of this speech. And in addition to basically dismissing all of the price increases that we're seeing now experiencing as being transitory pal also spent a lot of time rewriting history in lecturing the public as to the mistakes made by prior federal reserve's in being to trigger happy when it came to fighting inflation that turned out to be transitory but at the time the fed officials feared that it wasn't transitory and so they moved preemptively and that ended up being the wrong thing and powell said that he doesn't want to risk making that mistake. First of all none of those prior mistakes. The way powell described it happen while the fed was at zero right. There isn't a prior period of time. Where the fed had interest rates at zero. So even if it turns out which it's not but even if it turned out that inflation is actually transitory. Even if that's the case that doesn't justify keeping interest rates at zero nothing justifies keeping interest rates at zero. Accept my explanation that the fed knows if they raise rates. The economy is gonna crash and so they're not raising them and if they raise them later it'll crash even harder so they're never going to raise them. That is the only viable explanation for the feds failure to act not the idea. That inflation is transitory. Because even if it was that doesn't justify keeping interest rates at zero percent now but more importantly pows history lesson is wrong. Kids rewriting history. There is no history of fed chairman's being too aggressive on fighting inflation history shows that the opposite is true. they're always too dovish. they're never too tight. The only time we really had tight money was under paul volcker and that's not the policy that pows criticizing in fact. He has praised the policies of paul volcker. He's just somehow criticizing everybody else without specifically naming names. The one period in history were pal. Did acknowledge that the fed got it wrong as far as they thought the inflation transitory and it turned out not to be was during the nineteen seventies. But the most ridiculous part about that. Admission is what powell blames. The higher inflation on pow said that the fed was correct in assuming inflation was transitory because the big increase in food and energy prices reverse. So you had this big spike up oil and food and then at some point oil. Prices and food started to come down so supposedly according to powell that vindicated the fed that they were right but then what happened was that core consumer prices kept going up anyway even though food and energy prices started..
Marketplace with Kai Ryssdal
Fed adopts new inflation strategy, widely seen as leading to easier policy
"We would be remiss if we did not mention a big speech coming tomorrow from Fed Chair J. Paul the Title Monetary Policy Framework Review. Is I think we can all agree Adad Dry. What it's going to mean in real life though says economists Tim Dewey at the University of Oregon. In dry at all, my expectation is the Fed's going to basically loosen up how they've been thinking about their a two percent inflation target. Specifically, the Fed will actually try to overshoot the two percent target a little bit to make up for periods of undershooting the two percent target, and that's a big deal because central bankers today are still really really leery of inflation flashing back as they do to the nineteen seventies and Paul Volcker and a prime rate of twenty one and a half percent. But. What is this speech going to mean for you and me where you're gonNA notice a difference as maybe over the longer run like in this recovery, the federal probably won't raise interest rates as early as it did in the previous recovery. So maybe as a result of that, the recovery is a little bit faster and that would mean Jonah that rumour quickly that wages that grew more quickly and then maybe inflation was a little bit higher. And as often happens with the Fed Powell merely talking about higher inflation could just nudge the economy all by itself even the expectation that policy will be easier for longer could actually induce some of us to take economic activity now because it improves your confidence about the future. Tim Dewey at the university, of Oregon, there with the set of J. Pals big speech tomorrow on inflation. It's all virtual. By the way the Fed conference tomorrow, you can watch pal speech sued use. Should you so choose go to the Kansas City Fed's youtube site YouTube dot com slash Kansas City Fed.
What You Need to Know About the Coronavirus
"News covered nineteen what you need to know about coronavirus I'm Lucas Univar now we're going to look at the ways authorities around the world are responding to this pandemic the trump administration's handling of the crisis has been heavily criticized the president has given confusing advice contradicting his own experts and misleading the public about timelines for testing and vaccinations morning edition's Rachel Martin spoke to three of NPR's international correspondents about how other countries are handling the coronavirus Sylvia Julie is in Rome Anthony kun is in Seoul and and Lee Fang is in Beijing Emily I'm gonna start with you because you were covering the crisis in Wuhan from the beginning can you just give us a sense now about what was the trajectory of the Chinese response to this well for the first month after that initial cases of the current affairs sure there wasn't a response there is local cover up in a delay and during that time of about five million people left the virus epicenter in like the spread it to the rest of China but then the country mobilized it did so very quickly imposed very stringent self isolation and quarantine measures and by self isolation I mean people sort of waiting densely populated areas they canceled all public events they shut down factories and offices and by quarantine measures and that the they still sealed off cities and villages completely Anthony how does what and we just say said compared to what's been happening in in South Korea while South Korea got hit right after China and because of south Korea's experience with previous epidemics they decided that rapid mass testing for the virus was going to be the key to their strategy and so they've been testing around fifteen thousand people a day S. three thousand six hundred people per million of population compared to five people per million in the US results also focus on transparency putting out daily statistics and press briefings Sylvia in Italy I mean now Italy is has replaced South Korea as the number two in the world after China when it comes to the the scope of of this pandemic what has been the Italian response drastic curbs on freedom of movement and there's been overwhelming compliance only food shops pharmacies and you stands are open people can go out but if stopped by police they must show kind of affidavit that states the purpose either work grocery shopping health or emergency police are carrying out random checks they face either three months in jail or a fine of two hundred thirty dollars the purposes social distancing keep people apart Italy's following China's lead the Wuhan model so Emily the Wuhan model hasn't worked I mean transmission has decreased there has not yeah and experts pretty much unanimously agreed that's because of social distancing it will destroy your economy as it temporarily has in China but it quickly slows the virus's spread another thing China did was it built these makeshift centers where they sent six people and sending instead of sending them home and researchers in both the US and China have now said this week that that was critical to slowing down the outbreak but this could be a measure that western democracies may be unwilling to take as for quarantine measures though sealing off the ledges and cities that's the jury's still out on the efficacy of of that because quarantines meet harder for medical medical resources to reach heart the hardest hit areas and that's probably why fatality rates in the epicenter in China are nearly four times higher than the rest of the country so Sylvia how have the measures worked in Italy what's the situation right now is there any slowing well nationwide it's too early to say it hasn't hit the peak yet the quarantine that was put in place a few weeks ago in the contagion epicenter in Lombardy eleven pounds fifty thousand people local authorities say it's working the contagion rate has dropped and that's why the quarantine was extended to all of Italy to try to prevent a spread to the south which has much weaker health systems than those of the north which were among the best in Europe but they are severely strained by this crisis now I'm Anthony South Korea chose not to take measures like we've seen in Italy or in China with these dramatic quarantines are lockdowns and yet it seems like the have still been able to to keep the crisis at bay right yeah well okay so numbers have been declining for two weeks in a row and sexualities of been at less than one percent compared to about four percent for China and six percent for Italy and you know doing this without having to log huge regions down is also a kind of effectiveness kind of accuracy was or something specifically about South Korea that made it possible for them to avoid large scale large scale quarantines well it's you know testing capacity is not just about cats it's about investment in basic healthcare infrastructure lab technicians chemicals machines logistics and if any one of those areas has a bottleneck it's going to mess things up and people are going to lose lives and it's just you know at the end of the day it's investment in in a healthcare system hospital beds you know national health insurance and this shows up in survivability for all diseases including covert nineteen and lastly Emily and Sylvia I'd love for you to talk some about how the different political systems in China and Italy have affected the coronavirus responsibly you alluded to this earlier but really how much of China's success in mitigating the spread has to do with the fact that this is this is a country frankly with a long history of human rights abuses it is an authoritarian state we've seen transparency is critical for a fast response that wasn't present in China but because China is a very centralized government one might say authoritarian it was able to mobilize quarantine measures and self social distancing very very quickly the problem is quarantines may have cost more lives than we know but we'll never know the secondary costs of people who are not able to get timely medical care and suffered from it because they were sealed into their villages or cities right and still be obviously Italy is a democracy what is been just the people's response to these kinds of drastic measures the crisis has totally turned the world upside down Italians notorious for cutting into line not very beaten to rules are become the most compliant people I've ever seen in my life and French correspondents based here sent a petition to French president Emmanuel MacColl telling him France underestimates the gravity of the epidemic and failed to prepare French public opinion they say look at Italy it's our duty to tell you there's no time to lose NPR's Sylvia patrolling Anthony kun and Emily Feng talking with rich mark fears about the impact of coronavirus have sparked a financial crisis in the markets Austin Goolsby who chaired president Barack Obama's council of economic advisers says that as the virus spreads American markets might be hit even harder than China's and here's our Shapiro asked him why if you look at the economy of the United States or of the rich countries in Europe they're much more dominated by these face to face services that are exactly the things they get pulled down whether their leisure and entertainment and sports or going to the gym or all sorts of services so if everyone stops doing that that's a bigger hit on the U. S. economy even that it was in China we went when they shut down he also said that virus economics are different from regular economics explain what you mean by that yeah by that I mean the closest thing in our in our collective memories to this moment was a financial crisis right into my house I natural crisis economics and business cycle economics is a little different than the virus in that the main thing that is paralyzing the economy is this year and withdrawal and so in a way the best thing you can do for the economy has nothing to do with the economy with virus economics and that is things like paid leave for people that are sick is actually not stimulus it's paying people not to come to work but anything that slows the rate of spread of the virus is the best kind of stimulus so if we have to get on top of this as a public health matter I think before you can effectively deal with this as an economic except if we do so the rate of the virus in this epidemic continues for weeks or months is there anyway to turn around the financial slide yes and no no in that look if there's going to be a substantial slowdown our goal is and should be allowing us the opportunity to bounce back it as this thing passes over us and that means you can't let everybody go bankrupt or starve or have these persistent lasting problems from what we hope to be a temporary shock and so do you see the crunch that we're experiencing now as an irrational panic or an appropriate response to the cancellation of big economic engines like pro sports like Broadway lever like school like the economic activity that goes on in major cities every day yeah a bit of both as we in fear the withdrawal and have social distancing to try to slow the virus there is going to be a substantial slowdown of economic activity right but I can never get out of my head from the two thousand eight crisis Paul Volcker's words over and over at that time that during a crisis the only asset you have is your credibility and as the U. S. government has not made credible statements that contributes to fear that makes it go down and we've we've got to do better we need the president to
Marketplace with Kai Ryssdal
Remembering Paul Volcker
"Here's the thing about Paul Volcker the former chairman of the Federal Reserve arguably one of the most influential of Fed shares. Who died it yesterday at the age of ninety two? Yeah it's kind of an amazing story that's author and New York Times editorial board member beaming Applebaum on this show about a month or two ago. He used to cover the Fed for the Times. When Paul Volcker I started at the Federal Reserve he worked basically as a human calculator in an office deep inside the Federal Reserve? There Have Bank of New York in the early nineteen fifties and he told his wife one night that he didn't think he had a future at the Fed that as an economist he was always going to be consigned to being essentially. Actually you know A worker bee at this institution that was run by financial market types businessmen. Those even a Iowa Hog farmer there and he didn't think that he had much chance of getting ahead. Suffice it to say Paul Volcker got way ahead at the Federal Reserve. Jimmy Carter picked him to run the Central Bank in nineteen seventy nine with inflation and this is important headed toward almost fifteen percent. I ask Carter about that about the economic and political fallout from picking Volker when I interviewed the former president in two thousand ten so I went looking as I Picked up this book. I went looking for the name. Paul Volcker who You pointed to the Fed in nineteen seventy nine. You don't come across crosses name until page three hundred and forty something and it's really funny because it is dismissed in a sentence. Paul Volcker came in We decided we could work with him. And then the the next day bang you name to defend that was really the one of the most hotly debated things. I did because a lot of my political advisor. Said don't appoint Paul Volcker because he's going to tighten up on everything and you will have no control at all over the Fed anymore. You won't even have communication with him when Paul Volcker came. I was seeing the prospect of enormous inflation rates. And so I agreed with Paul Volcker in conversation that I would not interfere in what he did. I was prepared for him. To tighten up tremendously and drive interest rates and so forth up in order to control rampant in. It's funny actually because a little bit later in the book you basically say in this passage that you dictated at the time Volcker says he's going to have to tighten interest rates. And it's GonNa hurt me politically. I mean. You knew it was coming. I knew it was coming but I was prepared to take it. I thought that I could be reelected in spite of that as it turns out. Of course things didn't work out for President Carter about which I asked Paul Volcker in two thousand twelve if I read the see the recounting of that job interview correctly in this book. You basically said I want independence and I gotta do what I gotTa do. It was obvious why he wanted to see me. But I MR president and if you're thinking of appointing me Germany Federal Reserve. You have to know that I believe in somewhat entitled Monetary Policy and we have been following and my predecessor followed. Yeah you know I the next question I asked the president actually was Did you mind when he raised interest. He's like that and he said Oh no I I thought it was going to be good for the next presidential term. I thought that term was going to be mine. Not Raking No. He asked him why said I cost him the election. There's some people said and he had kind of Ri- smiled and he said well I think there were a few other factors as well after he left the Fed in nineteen eighty seven. Paul Volcker worked on on Wall Street for a while. Got Drafted back into government service every now and then most. Recently as the chairman of President Obama's economic recovery advisory board and as the namesake for the Volcker Carulli. The part of the Dodd Frank Financial Reform Bill that limited some of the kinds of trades. The Big Wall Street banks could make. But really when you think Paul Volcker. It's those years in the late nineteen seventies early nineteen eighties when the Fed pushed short-term interest rates up to a record twenty percent to get inflation back under control twenty percent went today the Fed's current short-term target rate is between one and a half percent and one and three quarters percent and it hasn't over five in more than a decade which makes double digit interest rates hard for most Americans below a certain age to even fathom so marketplace's Amy Scott takes us back in the early nineteen eighties and Owen managed a bank branch Boston to remember telling customers. They'd have to pay twenty one percent interest for a car loan today. The average is just over for four percent. They would get mad at the bank and many times they would just basically say I can't afford that. Oh and went on to become an economist at the Fed and now teaches at Hamilton College. She says those high interest rates had a purpose volcker was trying to slow down demand by making borrowing more expensive give. It made it difficult for people to buy houses by cars Credit card interest rates. Were extremely high. The economy did slowdown slowdown falling into two recessions. In one thousand nine hundred eighty two unemployment topped ten percent in protest homebuilders mailed. Chunks of two by fours is to Volker and members of Congress. Fred Napolitano is former president of the National Association of homebuilders. Just make a point to say this is what we do is is what we build you know with. The interest rate is hurting us. That pain eventually paid off. Robert King is a professor of economics at Boston University. Ultimately once people began to believe that inflation was gonNA come down it came down and interest rates tumbled and the economy recovered and and it's viewed as a major triumph at triumph. Nobody wants to have to repeat. I'm Amy Scott for marketplace. Paul Volcker did yesterday at at the age of ninety
News, Traffic and Weather
Former Fed Chief Paul Volcker, inflation slayer, dies at 92
"He was known as the fed chair who tamed inflation now Paul Volcker has died at his home in New York here's ABC Jim Ryan Paul Volcker served as chairman of the federal reserve under presidents Carter and Reagan but decades later head of president Obama's economic recovery advisory board to combat inflation folders that raise the federal funds rate and tighten the money supply and while it did cut inflation can also created the conditions for a recession he founded the Volcker alliance a nonpartisan nonprofit organization when he was eighty six to promote public service he died yesterday at ninety
Netflix, Golden Globes, Large Caps vs. Index Funds
"We're GONNA look at large cap. Stocks Relative to index funds. We're going to pour one out for Paul Volcker but we're going to start with the entertainment industry the Golden Globe. Nominations came out this morning for film and television the most nominations in film I went to Netflix with seventeen. Nominations followed by Sony and Disney with second and third respectively. Most nominations in television netflix with seventeen. HBO Second Hula Third. And I will just add parenthetically broadcast television completely. Shut out of the nominations for television. Where do you WanNa go with this because I we were talking a little bit this morning about this? Obviously this is A nice feather in the capital Net flicks and I think part of the reason is not just because it's nice to get this kind of recognition but also because is for anyone who's wondering about the money they're spending on content. Ted Surround US can point to this and say no. I feel like from a quality standpoint. We're doing pretty pretty well. Yeah I mean I I. I don't. I'm not surprised by this. I mean it really feels like this is just Reiterates what we've been watching. Play out over the last several years. Just just we're seeing the old legacy providers really take a hit on the content inside and I think a lot of that has to do with just the fact they've been hamstrung by Hold School advertising models and limitations on the type of content that they can produce and we saw netflix trump in their early on the power of the disruption That the Internet is provided in a lot of other companies have started to follow suit I I don't really. I'm not one that really focuses or cares much about what award awards shows say or what critics say when it comes to content But with that said I mean these types of awards just even these types of nominations regardless of whether they win or not these types of nominations certainly helped get this type of stuff on viewers radars. And I think that is probably one of the biggest benefits of all is that it is more more or less free publicity. I mean I say free. Obviously they're paying a lot of money to produce this stuff but it is. It is publicity that helps get a lot of this stuff on viewers radars as we enter after this phase of just more content than we ever have time to watch. It's nice to know what is what is Bubbling to the surface there as as the must see TV and in films and whatnot. And I think you know honestly it feels like we've talked about this golden age for for television television. It really feels like films have had a tough go of it in and I think part of the proof there is just. This constant need to reboot everything in in. These reboots are just so uncompetitive from so many different angles It's nice to see your net flexes and Disney's Hbo's taken these Creative Moon. MM shots so to speak and seeing some of them pay off absolutely and I think you're you're completely right particularly when it comes to the fact that you know we know that smaller networks whether it's FX AMC. Some of these other niche. But I guess from just from a content creation standpoint in a way they are niche because they're not producing a lot of original stuff but part of their pitch to show runners. Is We can give you a lot more oxygen in terms of promotion. Because the fact of the matter there is net flicks. They're going to promote their bigger hits and bigger budget items more but just the sheer number of original things. It's the Netflix is producing in a calendar. Year is in the hundreds and so as they continue to invest in things like stand up comedy. There's only so much promotion motion. They're going to give a new comedy special. No matter WHO's doing it they're going to say. Yeah Jason. Yeah you've got a new hour stand up special. That's we're GONNA give you about three days worth of promotion. It'll be on social social media and maybe a billboard a two and that's going to be it yeah and so it is this This really does afford them as you said this bonus opportunity to promote. Oh yeah the Irishman Yeah. It's a long film but apparently it's a great film Because it's getting all these award nomination I'm so torn on the Irish. I want to watch it so I know I'm not. I'm not going to have the patience to finish it and it's like you know it's going to be just an amalgamation of a lot of movies we've already seen with these guys he is and you're going to kind of know how it ends anyway. So do I need to bother really and then you get Scorsese at. They're just begging you not to watch it on your phone but it's four hours man. Yeah there's GonNa be some time spent watching this thing on my phone netflix is a very interesting situation right now. Because is it has such a headstart on all of these other streaming services that are coming to market in HBO included. I mean when you look at some of these numbers regarding Gordon content spend it's actually astounding thing I mean. NETFLIX IS GONNA spend fifteen billion dollars on content this year. You compare that with something like Disney Disney plus right. They're going to spend about a billion here in this first year. Now that'll continue to go up. His time goes on They're just getting started. But then you look at something like comcast peacock which is going to be the end. NBC Service. They're talking about spending two billion dollars of the first two years to grow that service and really always always recognized that service for more than anything is probably just the fact that it's going to have the office wants. The office leaves Netflix. Six But my point is is that a lot of these other services. Don't spend nearly as much on content that can be an advantage or a disadvantage depending on what your perspective is. I mean Netflix. Netflix is trying to build a service. That scratches niche for everybody and so they have this wide cross section of content that they're building at a cost a lot of money to do that. And if that's GONNA be their strategy they're are GONNA need to keep on doing that. That requires a lot of capital. And they're going to figure out ways to raise it. HBO Peacock Amazon Disney plus to a lesser extent. I mean they are focused a little bit more specific world and what they know where the content spend might not be as heavy but their catalogue is going to be more limited and that's that's by design So then it is just a matter of how these all come together in and how we as consumers are are going to pick and choose which services we ultimately want price. It's GonNa take take part of it but I mean people are GonNa pay up for what they want to see in in so you know again. I feel like Netflix. Having such a great head start. It's terrific from the consumer side but now from the investor side. You have to start asking yourself. How much more can they raise prices versus something like a Disney plus where it looks like? They have a lot of room to raise prices but they're also just getting started. You mentioned the number of sequels that we've seen I sort of the the reboots that we've seen and I agree with you from a creative standpoint. It's hard to get excited about that from a business standpoint when you look at the box office numbers for this year here and the fact that right now. The Lion King remake is number two at the box office and for anyone questioning Disney's he's movie strategy you. Can you can stop because Disney is on pace to do about ten billion dollars at the box office. Is this year. The biggest year they had was twenty sixteen. Just over seven and a half billion and I'm not even including the Fox properties include those that gets you closer to twelve billion but it's it's really phenomenal. What they've built in and good luck to whoever gets to succeed Bob Barker? Yeah Yeah. I mean they've got their work cut out for them but I tell it is amazing that even when Disney puts out something that you might not initially think you care all that much about then at some point or another you end up seeing it for one reason or another and you discover wow man. I really enjoyed that and I mean the most recent example for me was over Thanksgiving break lake. Were down at the river for the holiday and we keep that house. disconnected from the
AP News Radio
Former Federal Reserve Chairman Paul Volcker has died
"As fed chair in the early eighties Fokker elevated interest rates to historic highs causing a recession and was vilified by the public he later served as an economic adviser to president Obama and in two thousand nine during the Great Recession talked about the ongoing financial crisis the big economic problems behind the financial system so they're gonna take longer to work out Volcker pressed for restrictions on banks ability to trade in financial markets into invest in private equity and hedge funds those regulations became known as the Volcker rule I'm I camp in
Former Fed Chief Paul Volcker, inflation tamer, dies at 92
"Paul Volcker former fed chairman who broke the back of inflation during the eighties has died at age ninety two three decades later he led president Obama's bid to rein in the investment risk taking of commercial banks known as the Volcker rule moments ago we spoke about that rule with John at writing of already Q. economics the end of it on the page regulation so I think it was implemented in the way the necessarily wanted it to be implemented in the US we don't follow the spirit of the low we follow the letter of the law and the letter of the law tends to be very
NPR's Business Story of the Day
Binyamin Appelbaum On 'The Economists' Hour'
"Picture this in the early nineteen fifties. A young guy is working at a desk deep inside the federal reserve bank of new york. It's not exactly a corner office and he complains lanes to his wife that he has no future there at the fed. He's not a banker. He's not a lawyer. He is a lowly economist. That is what life is like for economists in the nineteen fifties. Nobody respects them in part. Just because <hes> economics was a new thing in the world the idea that people could manage economic conditions could improve economic conditions. These were new ideas in the world. I mean it's just stunning to think about that era. It was so different that is being you mean applebaum. He writes about economics for the new york doc times and he's written a new book called the economists our that traces what he calls a revolution in the way we think about economists this quiet but really important revolution solution that happens really beginning in the late nineteen sixties and the early nineteen seventies where economists begin to gain a tremendous influence over public policy in the united had states in fact that young economist told his wife he had no future at the fed that was paul volcker. He became one of a small group of economists who made themselves indispensable dispensable to u._s. Presidents voca rose to become the chairman of the federal reserve in the carter and reagan years so i asked applebaum had it a bunch of economists go from nobody's to being important people and he said it's pretty simple in an era of real economic problems. They promised solutions by the early nineteen seventies indies. It's really becoming clear that something is wrong. With the american economy people worry about their own future their children's future and economists enormously successful successful in asserting that they can fix the problem and their answer is basically that government needs to reduce its role in the economy <hes> that bureaucrats need to take their hands ends off the economy and allow markets to allocate resources government needs to trust in markets and this idea came from many economists but there was one economists in particular in your book you write about him a lot and that's milton friedman. Milton friedman have is very very simple idea that proved to be enormously sleep popular and along the way milton friedman became kind of a household name. He's a remarkable person he is this elfin libertarian who commands any room that he's in even though he's often the smallest person in the room and he's enormously successful essentially in in proselytizing this idea that that the solution to almost every public policy problem is for government to get out of the way and it has enormous appeal. I think in part because of its modesty. He's not saying milton. Friedman should be in charge of the economy. He's saying neither i nor anyone else should be in charge and for a generation that is confronting the failure of the economy. This has enormous appeal so at the heart of your thesis is not necessarily that milton friedman was correct you talk about these really negative unintended consequences that come from this idea that the market is always ace right in two thousand nineteen when we look back at the legacy of milton friedman and others like him with their faith in the markets. Where does that leave us now economist. It's really emphasized that there was a trade off between efficiency meaning getting the economy to grow as quickly as possible and equality meaning that everybody shared in the rewards awards prosperity and they argue that government needed to focus on efficiency that the goal of public policy should be to make the economy grow as fast as possible get as big as as possible but by ignoring inequality by deciding basically that government should stop trying to equalize the distribution of prosperity or the opportunities to to prosper <hes> it really contributed significantly to the rise of massive inequality in our society. You've been writing about economics for years and i wonder when you were researching shing this book. Were there any moments where you said oh. That's not what i thought it was. I'll tell you what i did not appreciate. When i started this process i did not understand the extent to which economists mist in the seventies were responding to real problems to a real breakdown <hes> in our system of governance and economic policy the extent to which these free market ideas really gained prominence and and popularity because of a broad perception that what we were doing had failed that is the thing that makes me want to spring to the defense of economists. I mean i was unaware unaware or only aware very vague sense that in the seventies this country hit inflation at like eleven percent twelve percent which is unthinkable now right. We haven't seen we haven't seen inflation like that in years. Our money has been stable in this country. There's so many other countries that don't have that luxury it makes me i think we don't these guys deserve a lot of credit for the fact that my dollar is going to be worth in a year about a dollar as opposed to seventy cents. I think they do deserve a lot of credit. I think it's a classic example of a revolution that went too far. The gains are real. The benefits real economists brought a lot of discipline to policy making ah in a lot of ways to improve the quality of public policy but by sort of embracing that idea to the exclusion of any other priorities by saying we're just gonna focus on efficiency by advocating for economists to take the wheel and excluding other points of view. We ended up in a really problematic place.
Bloomberg Daybreak: Asia
Paul Volcker calls out Trump on trade and taxes
"Former fed chairman Paul Volcker weighed in on the US China trade fight saying he's worried about the rhetoric and the threats coming out of the White House. Sometimes sounds terrible. But respond more favorably to what the president of China and the president of the United States. As Paul Volcker commenting in video with Bridgewater associates Ray Dallaglio on