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Ugh. These sort of pseudo-intellectual articles that mix economics and politics are my least favorite things to see on this site. They are super misleading and
by tryptophan 7y ago
Ugh. These sort of pseudo-intellectual articles that mix economics and politics are my least favorite things to see on this site. They are super misleading and play towards people's biases about how they view the world while selectively interpreting the sparse data they present to do so.
An example:
If there was too much money, you would think that bond yields would go down. Look here: https://www.cnbc.com/quotes/?symbol=US30Y https://www.cnbc.com/quotes/?symbol=US30Y -- looks like they are! Guess we can all go blame the fed and "trickle down". But oh wait, scroll out to a longer time-span. Looks like yields have been falling ~linearly from 1989 till today, 2019. Show me where QE/ZIRP started based on the chart. You can't, because the trend didn't change at 2008/9. All this "blame the fed, im smarter than them and would've not done QE" nonsense maybe isn't as supported by evidence as some would like. The world is a little more nuanced than that.
On the surface level, the data seems to agree, but you look a little deeper and it quickly becomes apparent it's all bullshit trying to spin a narrative.
- weirdstuff 7y agoI urge you to look at this chart: https://www.financialsamurai.com/wp-content/uploads/2015/07/SP500-10Year-FFR.png https://www.financialsamurai.com/wp-content/uploads/2015/07/... There's a strong correlation there. Fed funds rate seems to lead a bit. I agree with you about the all the bad writing. It's pernicious.
- internet_user 7y agoAt which point these charts become entirely meaningless? When the fed owns 50%+ of sp500? The fed, BOJ and ECB are already busy painting yield curves full time, the market has become so distorted it's not trivial to even orient yourself, nevermind to develop conclusions.