tag:blogger.com,1999:blog-5713178645208582139.post8559162739852268939..comments2024-03-22T02:37:15.030-05:00Comments on Macro Musings Blog: Global Safe Yields Continue Their Downward MarchDavid Beckworthhttp://www.blogger.com/profile/04577612979801459194noreply@blogger.comBlogger11125tag:blogger.com,1999:blog-5713178645208582139.post-50948577868845684022016-06-24T06:52:17.085-05:002016-06-24T06:52:17.085-05:00Our own logic has been tripping us up for almost f...Our own logic has been tripping us up for almost forty years: evidence since 1980 indicates that long-term increasing wealthy inequality leads to long-term declines in aggregate demand (purchasing power). Investors react to this in a flight to safety; businesses react by cutting back on capital investment; central banks react by continually lowering nominal rates; consumers react by saving more Emericus Durdenhttps://www.blogger.com/profile/07917398666770953204noreply@blogger.comtag:blogger.com,1999:blog-5713178645208582139.post-38407796619622111622016-06-17T03:51:29.306-05:002016-06-17T03:51:29.306-05:00George, Basel III is part of the story but not the...George, Basel III is part of the story but not the only one. The sudden downward acceleration of yields starting in 2008 speaks to lasting effect of the crisis and subsequent bad news shocks (never ending Eurozone crisis, fiscal cliff, China concerns, political uncertainty, etc.)David Beckworthhttps://www.blogger.com/profile/04577612979801459194noreply@blogger.comtag:blogger.com,1999:blog-5713178645208582139.post-40977992246441378172016-06-16T14:06:57.148-05:002016-06-16T14:06:57.148-05:00From what I can deduce from Credit Suisse’s “Globa...From what I can deduce from Credit Suisse’s “Global Money Notes #5” (you can find it via Google) Basle III’s has added a “Liquidity Coverage Raito” requirement that forces banks to hold ‘safe’ (liquid) assets in proportion to their risky assets in an attempt eliminate future liquidity crises. This would appear to be an attempt to force banks to return to the practices of the fifties, sixties, George H. Blackfordhttp://www.rweconomics.comnoreply@blogger.comtag:blogger.com,1999:blog-5713178645208582139.post-90642864583743624572016-06-16T12:49:25.547-05:002016-06-16T12:49:25.547-05:00does the "safe asset shortage problem" d...does the "safe asset shortage problem" diagnoses compete with secular stagnation, savings glut, debt overhang or complement them in your opinion?<br /><br />thanks Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-5713178645208582139.post-62516868097559363512016-06-16T12:42:19.847-05:002016-06-16T12:42:19.847-05:00We don't have a Safe Asset Problem. What we ha...We don't have a Safe Asset Problem. What we have is a distribution-of-income/saving problem. <br /><br />I don’t know the numbers for the rest of the world, but when the share of the top 1% in the US went from 8% in 1980 to 19% in 2012, the share of the bottom 99% went from 92% to 81%. As a result, the bottom 99% of the income distribution—99 out of 100 families—had, on average, 12% less George H. Blackfordhttp://www.rweconomics.comnoreply@blogger.comtag:blogger.com,1999:blog-5713178645208582139.post-60023339048091680002016-06-16T06:37:50.279-05:002016-06-16T06:37:50.279-05:00Your figure suggests that these are exclusive choi...Your figure suggests that these are exclusive choices. That's of course not correct, I think the cartoon figure does not need to be so confused, as the correct answer is of course: take all of the directions, they're not mutually exclusive. Of course in the real world we're exactly like the cartoon figure, and keep looking confused and freezing, looking like a deer straight in the Christiaanhttps://www.blogger.com/profile/13390409981798681710noreply@blogger.comtag:blogger.com,1999:blog-5713178645208582139.post-90240032882135576292016-06-15T20:27:01.544-05:002016-06-15T20:27:01.544-05:00This is horrific for investment managers who charg...This is horrific for investment managers who charge asset based fees. I guess I picked the wrong week to be an active manager! Markhttps://www.blogger.com/profile/14266278463756513176noreply@blogger.comtag:blogger.com,1999:blog-5713178645208582139.post-51218480126143114522016-06-15T19:58:10.151-05:002016-06-15T19:58:10.151-05:00You should take solace from Conor Sen who has argu...You should take solace from Conor Sen who has argued that we are on the cusp of a major housing boom over the next five years. <br /><br />See: https://www.washingtonpost.com/news/wonk/wp/2016/06/07/the-biggest-business-story-of-the-next-five-years/David Beckworthhttps://www.blogger.com/profile/04577612979801459194noreply@blogger.comtag:blogger.com,1999:blog-5713178645208582139.post-88579038053600490442016-06-15T17:08:16.505-05:002016-06-15T17:08:16.505-05:00Who is the money power?Who is the money power?Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-5713178645208582139.post-19242885978232686572016-06-15T16:34:08.989-05:002016-06-15T16:34:08.989-05:00Sorry, but this is scam by the money power. They a...Sorry, but this is scam by the money power. They are using the Brexit myth to wheel in the sheep. When it fails, there is going to be a mini-crash in bonds and huge short squeeze in global equities. Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-5713178645208582139.post-63651119300733636732016-06-15T15:48:29.479-05:002016-06-15T15:48:29.479-05:00Housing. Nationwide, we need millions of homes. ...Housing. Nationwide, we need millions of homes. That is why there is a shortage of safe assets. This will require support for generous mortgage markets, which few are willing to accept. Until this changes, the current trends will continue.<br />In the meantime, our major urban centers have repressive capital controls, implemented through housing policies, that provide outrageous returns on Kevin Erdmannhttps://www.blogger.com/profile/07431566729667544886noreply@blogger.com