Wall Street

Fed tapering: Doubts resurface again

MADRID | JP Marín Arrese | The revised growth figure for the US economy in Q1 comes as a nasty surprise. It has dampened market sentiment worldwide. Earlier assessments blaming bad weather the moderate setback no longer hold when faced with a downturn close to 3%. Even discarding a fallback into full-fledged recession, it undoubtedly points to a markedly weaker performance than expected. The Fed tapering strategy is confronted with a baffling dilemma.

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Halting QE= Active monetary asphyxiation?

NEW YORK | By Benjamin Cole at Historinhas |  The recent historical and empirical record strongly suggests central bank quantitative easing (QE) works. The riddle is whether both the Japan and U.S. economies will slip into stagnation again without QE, as long as there is a global glut of capital holding down interest rates, and inflation is dead—or even if inflation is near 2 percent on the PCE deflator, the putative Fed target. The riddle might even be reframed: When central banks do not conduct QE, are they actively engaged in monetary asphyxiation?

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IMF’s warning to the FED

MADRID | By The Corner | The International Monetary Fund (IMF) revised downwards its growth forecasts for the US from 2.8% in April 2014 to 2%, and maintained 2015 outlook in 3%. Furthermore, the institution believes that the country will not achieve full employment before 2017.


Monetary policy- the way we were (without revisionist history)

SAO PAULO | By Benjamin Cole via Historinhas | Sadly for Americans, the Fed of 2008 would pull out the 50-year-old playbook and repeat the mistakes of the Fed of the 1950s. Rattled by minor increases in prices, the 2008 Fed stomped on the brakes, bringing on the Great Recession from which the nation has yet to fully recover.

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Market chatter: Foreign investors courting Spanish real estate firms and much more

MADRID | By Jaime Santisteban | Chinese real estate sector saw its outlook downgraded by Moody’s while Spanish housing sector keeps on moving forward, appealing institutional investors. Blackstone, PSP, Drago Capital, Colonial represent the increasing appetite for properties in Madrid and Barcelona. And don’t miss Fed’s Charles Plosser words: he believes the US central bank is “sitting on a ticking bomb.”



Nobody waiting for the Federal Reserve

WASHINGTON| By Pablo Pardo | The US private sector already reached the same employment figures it had before the subprime crisis started. This is one of the first solid signs of the so-called Gran Recession at the other side starting to fade. Given that the Federal Reserve has a dual mandate, including price stability as well as full employment, that suggests the still leading world economy- which could become the second after China if the World Bank’s forecast is correct- is beginning to take cruising speed.