Inflation Peaks/Real-gdp Peaks/Interest Rates Peak

[Rajiv]

Re: Inflation Peaks/Real-gdp Peaks/Interest Rates Peak

Also, the University of Hawaii John Burns School of medicine got the Robert Carey award in 2002 for the best medical center in the US -- This is the Malcolm Baldridge Award.

The 3 doctors listed are considered a major part of the group the first identified Kawasaki Syndrome. But Dr. Kawasaki being the first to raise the issue got the disease named after him. Also Japanese are genetically much more susceptible to the disease.

[Jim Nickerson]

Re: Inflation Peaks/Real-gdp Peaks/Interest Rates Peak

Also, the University of Hawaii John Burns School of medicine got the Robert Carey award in 2002 for the best medical center in the US -- This is the Malcolm Baldridge Award.

The 3 doctors listed are considered a major part of the group the first identified Kawasaki Syndrome. But Dr. Kawasaki being the first to raise the issue got the disease named after him. Also Japanese are genetically much more susceptible to the disease.

It's obvious we all have more time than brains to be beating such a worthless dead horse.

Why would Robert Carey award be the Malcolm Baldridge Award? That seems to be a bit of a non sequitur.

Here is apparently a list of the Malcolm Baldridge awards http://en.wikipedia.org/wiki/Malcolm..._Quality_Award

Within the list using "search" function I find nothing about any hospital in Hawaii.

[zoog]

Re: Inflation Peaks/Real-gdp Peaks/Interest Rates Peak

It's obvious we all have more time than brains to be beating such a worthless dead horse.

Now where have I seen that recently...

[Rajiv]

Re: Inflation Peaks/Real-gdp Peaks/Interest Rates Peak

I
Why would Robert Carey award be the Malcolm Baldridge Award? That seems to be a bit of a non sequitor.

From: http://www.va.gov/dmeeo/ca/files/divnews/Y07M06CC.pdf

The Baldrige Criteria for Performance Excellence.

The Malcolm Baldrige National Quality Improvement Act of 1987 established an AWARD program to PROMOTE quality awareness, RECOGNIZE quality and business achievements of U.S. organizations, and PUBLICIZE these organizations’ successful performance strategies.

America’s highest honor for performance excellence, the Baldrige Award is presented annually to U.S. organizations by the President of the United States.

Awards are given in manufacturing, service, small business, education, and health care. Beginning in 2007, non-profit organizations will also be eligible to apply for the award


.
The Department of Veterans Affairs has its OWN version of the Baldrige Award: The Secretary of Veterans Affairs’ Robert W. Carey Performance Excellence Award.
The Carey Award uses the Baldrige Criteria as the basis for evaluating organizational performance. Awarded annually since 1992, the CAREY Award recognizes organizations within the Department of Veterans Affairs that have implemented management approaches resulting in sustained high levels of PERFORMANCE and SERVICE to veterans.
The award is named in memory of Robert W. Carey, a publicly recognized VA quality leader and a champion for excellence in the Federal government. He was the Director of the Philadelphia Regional Office and Insurance Center from 1985 until 1990.
ALL organizations in the Department of Veterans Affairs are eligible to compete for the Carey Award.

[flow5]

Re: Inflation Peaks/Real-gdp Peaks/Interest Rates Peak

glad you had fun inspector Cluso; only one of you got one name right; everything else was peripheral

[flow5]

Re: Inflation Peaks/Real-gdp Peaks/Interest Rates Peak

Financial Crisis follows Federal Reserve Interest Hikes
1980: economy peaks in Jan 1980, following a jump in interest rates & oil prices in 1979. Texas Hunt brothers silver investments, largest in the world, collapse.
1982: Economy re-enters recession in July 1981. Mexico threatens to default on its loans, which make up 44% of 9 largest U.S. banks total capital. Drysdale Securities unable to repay loans to Chase Manhattan. Penn Square Bank, with huge loans in oil and gas, fails in July as oil prices fall.
1987: Black Monday. Stock market plunges 25% in worst decline since Depression on Fed rate hikes, talk of dollar develation.
1984: Continental Illinois, nation's 6th-largest bank, fails. Bad loans from Penn square partly blamed.
1990: S&L crisis, brought on by higher rates & regulations, makes thousands of thrifts insolvent.
1994: Mexico's "tequila" peso crisis.
1997: Asia Crisis starts with capital flight, ends with massive devaluations and declines in output.
1998: LTCM, a large hedge fund that made billions of bad, highly leveraged investments, bailed out by Fed-organized group. Russia defaults on some debt as oil prices fall, sending ruble off sharply.
2000: Nasdaq meltdown, biggest ever, takes our $8 trillion in shareholder equity. Recession begins in March 2001.
2001: 9/11 attacks bring financial uncertainty, global War on Terror.
2002: Argentina threatens default on IMF loans, Enron, Tyco, WorldCom & others embroiled in corporate scandals.
2007: Subprime loans create concerns about credit & liquidity through U.S. markets.
Investors Business Daily

[FRED]

Re: Inflation Peaks/Real-gdp Peaks/Interest Rates Peak

April 4, 2006 our Daily News section ran a piece from Telegraph UK No mercy now, no bail-out later: ”As Ben Bernanke knows all too well, monetary policy is like pulling a brick across a rough wooden table with a piece of elastic. Tug, tug, tug: nothing happens. Tug a little harder: it leaps off the surface and knocks your teeth out.”

[flow5]

Re: Inflation Peaks/Real-gdp Peaks/Interest Rates Peak

4 WEEKS 13 WEEKS 26 WEEKS DATE BANK DISCOUNT COUPON EQUIVALENT BANK DISCOUNT COUPON EQUIVALENT BANK DISCOUNT COUPON EQUIVALENT
06/21/2007 4.07 4.15 4.57 4.70 4.76 4.96 06/22/2007 4.18 4.26 4.59 4.72 4.75 4.95 06/25/2007 4.30 4.38 4.69 4.83 4.81 5.01 06/26/2007 4.44 4.53 4.69 4.83 4.81 5.01 06/27/2007 4.15 4.23 4.64 4.77 4.75 4.95 06/28/2007 3.97 4.05 4.64 4.77 4.75 4.95 06/29/2007 4.16 4.24 4.68 4.81 4.74 4.93 07/02/2007 4.40 4.49 4.81 4.95 4.82 5.02 07/03/2007 4.67 4.77 4.81 4.95 4.82 5.02 07/05/2007 4.65 4.74 4.81 4.95 4.83 5.03 07/06/2007 4.60 4.69 4.81 4.95 4.81 5.01 07/09/2007 4.54 4.63 4.83 4.97 4.85 5.05 07/10/2007 4.64 4.73 4.81 4.95 4.83 5.03 07/11/2007 4.63 4.72 4.81 4.95 4.84 5.04 07/12/2007 4.62 4.71 4.83 4.97 4.85 5.05 07/13/2007 4.61 4.70 4.83 4.97 4.85 5.05 07/16/2007 4.62 4.71 4.84 4.98 4.87 5.08 07/17/2007 4.67 4.77 4.82 4.96 4.87 5.08 07/18/2007 4.67 4.77 4.82 4.96 4.85 5.05 07/19/2007 4.67 4.76 4.84 4.98 4.86 5.06 07/20/2007 4.65 4.74 4.83 4.97 4.85 5.05 07/23/2007 4.76 4.85 4.88 5.02 4.89 5.10 07/24/2007 4.95 5.05 4.88 5.02 4.87 5.08 07/25/2007 4.94 5.04 4.85 4.99 4.85 5.05 07/26/2007 4.89 4.99 4.78 4.92 4.76 4.96 07/27/2007 4.80 4.90 4.72 4.85 4.75 4.95 07/30/2007 4.85 4.95 4.82 4.96 4.80 5.00 07/31/2007 5.03 5.13 4.82 4.96 4.79 4.99 08/01/2007 4.96 5.06 4.75 4.89 4.76 4.96 08/02/2007 4.93 5.03 4.75 4.89 4.75 4.95 08/03/2007 4.85 4.95 4.72 4.85 4.72 4.91

Daily Treasury Bill Rates: These rates are the daily secondary market quotation on the most recently auctioned Treasury Bills for each maturity tranche (4-week, 13-week and 26-week) that Treasury currently issues new Bills. Market quotations are obtained at approximately 3:30 PM each business day by the Federal Reserve Bank of New York. The “Bank Discount” rate is the rate at which a Bill is quoted in the secondary market and is based on the par value, amount of the discount and a 360-day year. The “Coupon Equivalent,” also called the “Bond Equivalent,” or the “Investment Yield,” is the bill’s yield based on the purchase price, discount, and a 365- or 366-day year. The Coupon Equivalent can be used to compare the yield on a discount bill to the yield on a nominal coupon bond that pays semiannual interest.

[flow5]

Re: Inflation Peaks/Real-gdp Peaks/Interest Rates Peak





Now down until Oct. Then up sharply until Jan.

[FRED]

Re: Inflation Peaks/Real-gdp Peaks/Interest Rates Peak

4 WEEKS 13 WEEKS 26 WEEKS DATE BANK DISCOUNT COUPON EQUIVALENT BANK DISCOUNT COUPON EQUIVALENT BANK DISCOUNT COUPON EQUIVALENT
06/21/2007 4.07 4.15 4.57 4.70 4.76 4.96 06/22/2007 4.18 4.26 4.59 4.72 4.75 4.95 06/25/2007 4.30 4.38 4.69 4.83 4.81 5.01 06/26/2007 4.44 4.53 4.69 4.83 4.81 5.01 06/27/2007 4.15 4.23 4.64 4.77 4.75 4.95 06/28/2007 3.97 4.05 4.64 4.77 4.75 4.95 06/29/2007 4.16 4.24 4.68 4.81 4.74 4.93 07/02/2007 4.40 4.49 4.81 4.95 4.82 5.02 07/03/2007 4.67 4.77 4.81 4.95 4.82 5.02 07/05/2007 4.65 4.74 4.81 4.95 4.83 5.03 07/06/2007 4.60 4.69 4.81 4.95 4.81 5.01 07/09/2007 4.54 4.63 4.83 4.97 4.85 5.05 07/10/2007 4.64 4.73 4.81 4.95 4.83 5.03 07/11/2007 4.63 4.72 4.81 4.95 4.84 5.04 07/12/2007 4.62 4.71 4.83 4.97 4.85 5.05 07/13/2007 4.61 4.70 4.83 4.97 4.85 5.05 07/16/2007 4.62 4.71 4.84 4.98 4.87 5.08 07/17/2007 4.67 4.77 4.82 4.96 4.87 5.08 07/18/2007 4.67 4.77 4.82 4.96 4.85 5.05 07/19/2007 4.67 4.76 4.84 4.98 4.86 5.06 07/20/2007 4.65 4.74 4.83 4.97 4.85 5.05 07/23/2007 4.76 4.85 4.88 5.02 4.89 5.10 07/24/2007 4.95 5.05 4.88 5.02 4.87 5.08 07/25/2007 4.94 5.04 4.85 4.99 4.85 5.05 07/26/2007 4.89 4.99 4.78 4.92 4.76 4.96 07/27/2007 4.80 4.90 4.72 4.85 4.75 4.95 07/30/2007 4.85 4.95 4.82 4.96 4.80 5.00 07/31/2007 5.03 5.13 4.82 4.96 4.79 4.99 08/01/2007 4.96 5.06 4.75 4.89 4.76 4.96 08/02/2007 4.93 5.03 4.75 4.89 4.75 4.95 08/03/2007 4.85 4.95 4.72 4.85 4.72 4.91

Has the Fed ever cut rates significantly from such a low base before?

[bart]

Re: Inflation Peaks/Real-gdp Peaks/Interest Rates Peak

Has the Fed ever cut rates significantly from such a low base before?

Yes... 1960, 1957... and 1929 (although 1929 is a little dicey since the 6% peak lasted only a few weeks).

[flow5]

Re: Inflation Peaks/Real-gdp Peaks/Interest Rates Peak

Release Date: August 7, 2007
For immediate release
The Federal Open Market Committee decided today to keep its target for the federal funds rate at 5-1/4 percent.
Economic growth was moderate during the first half of the year. Financial markets have been volatile in recent weeks, credit conditions have become tighter for some households and businesses, and the housing correction is ongoing. Nevertheless, the economy seems likely to continue to expand at a moderate pace over coming quarters, supported by solid growth in employment and incomes and a robust global economy.
Readings on core inflation have improved modestly in recent months. However, a sustained moderation in inflation pressures has yet to be convincingly demonstrated. Moreover, the high level of resource utilization has the potential to sustain those pressures.
Although the downside risks to growth have increased somewhat, the Committee's predominant policy concern remains the risk that inflation will fail to moderate as expected. Future policy adjustments will depend on the outlook for both inflation and economic growth, as implied by incoming information.
Voting for the FOMC monetary policy action were: Ben S. Bernanke, Chairman; Timothy F. Geithner, Vice Chairman; Thomas M. Hoenig; Donald L. Kohn; Randall S. Kroszner; Frederic S. Mishkin; Michael H. Moskow; William Poole; Eric Rosengren; and Kevin M. Warsh.

(1) As their statements indicate, the FOMC breaks down both real-gdp & the core PCE as a policy standard. The Fed won't let the economy decelerate to where it would jeopardize tax receipts. The rates-of-change in the proxies for monetary flows (MVt) for both real-gdp & inflation are now decreasing. The most rapid fall in the rate-of-change in nominal-gdp begins at the end of Aug. Nominal-gdp then bottoms in Oct. Thereafter the economy rebounds and inflation rebounds with it until c. Jan 08. This holiday looks stronger than the last 2.
I can't tell how fast the economy will slow, or how much it will slow. But if there is to be a cut and it coincides with this window's slowdown (the FOMC is proactive), then it will probably fall in the Sept. period? (Fed's next scheduled meeting on September 18). And though improbable, the decision to cut rates would be made before the Bureau of Economic Analysis releases 3rd quarter data (unusual?).
(2) There are obviously liquidity problems with mortgage backed securities. The NYFRB bought 49b of mortgage collateral on Thur. & Fri. The "trading desk" bought 38b of mortgage repo's for 3 days & 5 mortgage repo's for 1 day & 6 mortgage repo's for 14 days. These are temporary open market operations which add free legal reserves to depository institutions. I expect that some portion of these open market purchases will be rolled over for a relatively short time and then "washed out".

[flow5]

Re: Inflation Peaks/Real-gdp Peaks/Interest Rates Peak

The financial press reported that the “fed funds rate rose as high as 6 percent on Friday” (above the Federal Reserve’s target rate off 5.25 percent) and that this “prompted the central bank to inject temporary” free legal reserves into the banking system. Unfortunately, these publications continue to circulate outdated explanations for FOMC operating objectives and procedures.
And if you look back at the range fluctuation data (the Federal Funds Bracket Racket), the “trading desk” allowed fed funds rate to be traded as high as 6% on 7 different days during the last month. But no previous rate rise was the consequence of a panic-stricken marketplace.
The FOMC establishes monetary policy and directs the FRBNY Open Market Desk to execute it. Each day the FRBNY Open Market Desk sets a one-day-repo rate on Treasuries, or the one-day-cost-of-carry on government bonds. This is the actual policy instrument – and it affects the entire U.S. Government market (operationally, the one-day-return on all U.S. Government Securities). Federal Funds transactions are inconsequential in comparison.
In the last 28 days, the highest trading rate for repo’s was 5.28%. In the last 28 days, the highest trading rate for mortgage backed securities was 5.32%. These rates were well below the highs for federal funds.
The FRBNY conducts open market operations (selling & purchasing, reselling & repurchasing, & lending) to facilitate the efficient clearing of U.S. Government securities. The FRBNY holds all dollar denominated assets (except for securities purchased under agreements to resell) in the System Open Market Account (SOMA). Both temporary and permanent open market operations are reported on “Factors that Affect Reserve Balances of Depository Institutions & the Condition Statement of the Reserve Banks – H4.1 release.

[flow5]

Re: Inflation Peaks/Real-gdp Peaks/Interest Rates Peak

Release Date: August 10, 2007


For immediate release
The Federal Reserve is providing liquidity to facilitate the orderly functioning of financial markets.
The Federal Reserve will provide reserves as necessary through open market operations to promote trading in the federal funds market at rates close to the Federal Open Market Committee's target rate of 5-1/4 percent. In current circumstances, depository institutions may experience unusual funding needs because of dislocations in money and credit markets. As always, the discount window is available as a source of funding.

[bart]

Re: Inflation Peaks/Real-gdp Peaks/Interest Rates Peak

The financial press reported that the “fed funds rate rose as high as 6 percent on Friday” (above the Federal Reserve’s target rate off 5.25 percent) and that this “prompted the central bank to inject temporary” free legal reserves into the banking system. Unfortunately, these publications continue to circulate outdated explanations for FOMC operating objectives and procedures.
And if you look back at the range fluctuation data (the Federal Funds Bracket Racket), the “trading desk” allowed fed funds rate to be traded as high as 6% on 7 different days during the last month. But no previous rate rise was the consequence of a panic-stricken marketplace.
The FOMC establishes monetary policy and directs the FRBNY Open Market Desk to execute it. Each day the FRBNY Open Market Desk sets a one-day-repo rate on Treasuries, or the one-day-cost-of-carry on government bonds. This is the actual policy instrument – and it affects the entire U.S. Government market (operationally, the one-day-return on all U.S. Government Securities). Federal Funds transactions are inconsequential in comparison.
In the last 28 days, the highest trading rate for repo’s was 5.28%. In the last 28 days, the highest trading rate for mortgage backed securities was 5.32%. These rates were well below the highs for federal funds.
The FRBNY conducts open market operations (selling & purchasing, reselling & repurchasing, & lending) to facilitate the efficient clearing of U.S. Government securities. The FRBNY holds all dollar denominated assets (except for securities purchased under agreements to resell) in the System Open Market Account (SOMA). Both temporary and permanent open market operations are reported on “Factors that Affect Reserve Balances of Depository Institutions & the Condition Statement of the Reserve Banks – H4.1 release.

Yes - but what is your point?

Fed Funds have traded well beyond a +/- 1/2% band around the established rate on many days and for many years.