Friday, December 6, 2013

The Federal Reserve has lost Control of the Bond Market

Q: Do you think the taper fears are overdone by the markets? 


MARC FABER : The market has already adjusted, because they introduced QE3, QE4 in the summer of 2012. At the time the 10-year Treasury note yield was 1.43 percent. We are now at 2.8 percent on the 10-year. In other words, they have both assets at the end of November over a trillion dollars already this year and yet interest rates have gone up; in other words it seems that the Federal Reserve has lost control of the bond market. They can keep short-term rates indefinitely at essentially very low rate, but there will be of course some economic damages arising from zero interest rate policies. - in moneycontrol

MARC FABER
MARC FABER


Marc Faber is an international investor known for his uncanny predictions of the stock market and futures markets around the world.

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