View Full Version : Fed boosts QE and ties rates to unemployment level
http://www.telegraph.co.uk/finance/economics/9740740/Fed-boosts-QE-and-ties-rates-to-unemployment-level.html
The central bank replaced a more modest stimulus program due to expire at year-end with a fresh round of Treasury purchases that will increase its balance sheet. It committed to monthly purchases of $45bn in Treasuries on top of the $40bn per month in mortgage-backed bonds it started buying in September.
http://i.telegraph.co.uk/multimedia/archive/02426/bernanke_2426017b.jpg
phantom_opera
13-12-12, 06:48
*FED BOOSTS QE WITH $45 BILLION IN MONTHLY TREASURY PURCHASES
*FED TO KEEP BUYING MORTGAGE BONDS AT PACE OF $40 BLN PER MONTH
*FED SAYS MONTHLY PURCHASES TO TOTAL $85 BLN
*FED ADOPTS ECONOMIC THRESHOLDS FOR POLICY TIGHTENING
*FED: RATES TO STAY EXCEPTIONALLY LOW WITH JOBLESS ABOVE 6.5%
*FED: RATES TO STAY LOW WITH INFLATION SEEN AT 2.5% OR LESS
the only surprise is hard targeting i.e. interest rate will increase of unemployment rate lowered to 6.5% or inflation beyond 2.5% .... of course, the pace of increase can be at turtle speed :p market thinks the 1st int rate increase might happen in mid 2015
USD weakening is the only result, market still waiting for fiscal cliff
Could take another year or 2 to get unemploment rate down to 6.5%.
Could take another year or 2 to get unemploment rate down to 6.5%.
May take forever.
phantom_opera
13-12-12, 08:06
Market priced in 30pc chance of first rate hike in mid 2015
Still got 2.5y
Market priced in 30pc chance of first rate hike in mid 2015
Still got 2.5y
Hi, how you get the 30percent figure?
Also, it means 70percent chance of 1st rate hike after 2015?
So to summarise, is this good news to vested properties owners?
ikan bilis
13-12-12, 08:50
So to summarise, is this good news to vested properties owners? heya, even let's say,... if no news, everything stays where it is... that's already good news to vested owners liow... ;)
phantom_opera
13-12-12, 09:22
as market expected 85b increase of balance sheet per month, at least Bernanke did not disappoint, after 1y, US Fed balance sheet will be 4T, debt 18T (from current level of 16.3T) at the end of 2013
Bernanke is a master to keep market flat (or market has completely front-run him?) and slow destroyer of USD :D Can Mr Khaw keep land price flat? :p
propertychap
13-12-12, 09:37
So will more potential property buyers on the sidelines start to take action? Interest rate so low .. where else to park your cash?
phantom_opera
13-12-12, 09:40
So will more potential property buyers on the sidelines start to take action? Interest rate so low .. where else to park your cash?
since SG inflation started in around 2005 ... except one year of deflation during Lehman, say this cycle you have 2015 - 2005 = 10y - 1y Lehman = 9y of 6% real inflation
money in bank 1%, so effectively lose 5%pa ... 9x5 = 45% :scared-1: if you have large amount of $$ in CPF OA even worse ...
do nothing is not an option but it may be already too late :scared-3:
Keeping the land cost flat is almost impossble unless no more bidding and all use for HDB :D
what they can do is perhaps, add in another condition, not the highest bidder will get; but the developer must also come with social economic impact (add in social values). A greener environment, a elderly friendly project, a development which promote 3 or more generation living, etc...that will be a good starting point.:o
as market expected 85b increase of balance sheet per month, at least Bernanke did not disappoint, after 1y, US Fed balance sheet will be 4T, debt 18T (from current level of 16.3T) at the end of 2013
Bernanke is a master to keep market flat (or market has completely front-run him?) and slow destroyer of USD :D Can Mr Khaw keep land price flat? :p
phantom_opera
13-12-12, 10:07
the recent land bids near MRT all record breaking
- Jurong East 700psf
- Tanah Merah 790psf
- Bukit Merah 975psf / Prince Charles 960psf
- Bishan 850psf (ok lah maintain)
- Farrer Road 1107psf
CAPL, CDL and UOL are now more aggressive than FEO in bidding so sooner or later it will force FEO to be aggressive too
bakasa2002
13-12-12, 10:11
Keeping the land cost flat is almost impossble unless no more bidding and all use for HDB :D
what they can do is perhaps, add in another condition, not the highest bidder will get; but the developer must also come with social economic impact (add in social values). A greener environment, a elderly friendly project, a development which promote 3 or more generation living, etc...that will be a good starting point.:o
unlikely to set such rules for private developers, only can do it in their own backyard for HDB & ECs ...
2013 Redhill to hit selling price of $2,000?
Let's say...
2013 ave psf $1400 for new launches islandwide..
2014 $1600..
2015 $1800..
Then dip 20% post 2015
2016 $1440..
Can stomach this?
phantom_opera
13-12-12, 10:17
2013 Redhill to hit selling price of $2,000?
Let's say...
2013 ave psf $1400 for new launches islandwide..
2014 $1600..
2015 $1800..
Then dip 20% post 2015
2016 $1440..
Can stomach this?
no guarantee rate hike will come, market only pricing in 30+% of chance in mid 2015 ... first cut will be 25 basis points only then may wait donkey years again b4 next
imo, it is more likely that US debt hit 20T in 2016, bond vigilantes may strike to force the interest rate up :p in that case in 2016, BRICs may reduce USD reserve to near zero
no guarantee rate hike will come, market only pricing in 30+% of chance in mid 2015 ... first cut will be 25 basis points only then may wait donkey years again b4 next
however, if US debt hit 20T in 2016, bond vigilantes may strike to force the rate up
Agree. But Bernanke is signalling the market with actual target figures. 2.5% inflation and 6.5% unemployment. Seems to me he is preparing hikes in anticipation of more solid and rapid recovery..
phantom_opera
13-12-12, 10:26
Agree. But Bernanke is signalling the market with actual target figures. 2.5% inflation and 6.5% unemployment. Seems to me he is preparing hikes in anticipation of more solid and rapid recovery..
it may be purely political ... remember unemployment rate does not include those giving up searching for jobs
Agree. But Bernanke is signalling the market with actual target figures. 2.5% inflation and 6.5% unemployment. Seems to me he is preparing hikes in anticipation of more solid and rapid recovery..
Too lazy to search for latest report...
http://www.ritholtz.com/blog/2011/05/employed-persons-1999-2001-2003-2011/
To create 1% of the total job market = how many people???
You determine yourself...
phantom_opera
13-12-12, 10:32
Too lazy to search for latest report...
http://www.ritholtz.com/blog/2011/05/employed-persons-1999-2001-2003-2011/
To create 1% of the total job market = how many people???
You determine yourself...
inline the graph
http://www.ritholtz.com/blog/wp-content/uploads/2011/05/payroll0516111_big.gif
Too lazy to search for latest report...
http://www.ritholtz.com/blog/2011/05/employed-persons-1999-2001-2003-2011/
To create 1% of the total job market = how many people???
You determine yourself...
Difficult but not impossible.
Worldwide inflation will also hit USA. If one believes the inflation story, then hitting 2.5% is not difficult right?
For unemployment figures:
http://www.tradingeconomics.com/charts/united-states-unemployment-rate.png?s=usurtot
no guarantee rate hike will come, market only pricing in 30+% of chance in mid 2015 ... first cut will be 25 basis points only then may wait donkey years again b4 next
imo, it is more likely that US debt hit 20T in 2016, bond vigilantes may strike to force the interest rate up :p in that case in 2016, BRICs may reduce USD reserve to near zero
Actually this is what the US want, but the rest of the world won't do. In the interest of protecting their own economy the rest of the world won't let USD to depreciate too much. Strong USD is what keeping US inflation artificially low. If BRIC countries reduce its USD reserve, their own currency will fly high. That will kill their competitiveness in a heart beat.
http://data.bls.gov/generated_files/graphics/LNS14000000_1034315_1355369969174.gif
Difficult but not impossible.
Worldwide inflation will also hit USA. If one believes the inflation story, then hitting 2.5% is not difficult right?
surely, with USD so depreciated now.. (imported) inflation should be quite high for them, no? are they THAT self sufficient?
auroraborealis
13-12-12, 10:43
but for BRICs to reduce USD reserve to zero, they need an alternative
doesn't look like will have better candidates
JPY will prob match or outperform USD printing; EUR think take another 10 years or so for the banking & fiscal union to form & complement monetary union; RMB mayb another 10-20years
:2cents: just stay vested in SGD and SG properties :spliff:
:2cents: :2cents: i do think it's my good fortune to b singaporean most of the time; "qian shi xiu lai" :D
no guarantee rate hike will come, market only pricing in 30+% of chance in mid 2015 ... first cut will be 25 basis points only then may wait donkey years again b4 next
imo, it is more likely that US debt hit 20T in 2016, bond vigilantes may strike to force the interest rate up :p in that case in 2016, BRICs may reduce USD reserve to near zero
auroraborealis
13-12-12, 10:46
must give it to them, achieving energy self sufficiency so soon
if they follow china style buying resources elsewhere (like another bro/sis stated in other thread) & pump in more to develop their own argi further, i don't think it's an impossible feat for them :2cents: :2cents:
surely, with USD so depreciated now.. (imported) inflation should be quite high for them, no? are they THAT self sufficient?
http://data.bls.gov/generated_files/graphics/LNS14000000_1034315_1355369969174.gif
Which is easier to do, bring unemployment from
1. 10 to 8
2. 8 to 6
3. 6 to 4
4. 4 to 2
5. 2 to 1
All above in %.
Food for thot
since SG inflation started in around 2005 ... except one year of deflation during Lehman, say this cycle you have 2015 - 2005 = 10y - 1y Lehman = 9y of 6% real inflation
money in bank 1%, so effectively lose 5%pa ... 9x5 = 45% :scared-1: if you have large amount of $$ in CPF OA even worse ...
do nothing is not an option but it may be already too late :scared-3:
I just effectively about to clean out my CPF OA right on the dot 2 Jan 2013.
Which is easier to do, bring unemployment from
1. 10 to 8
2. 8 to 6
3. 6 to 4
4. 4 to 2
5. 2 to 1
All above in %.
Food for thot
They did it from 10% to 8% in 2 years.
8% to 6% is difficult but not impossible. Another 3 years?
So 2015 Mr B will resurface...:banghead:
Keeping the land cost flat is almost impossble unless no more bidding and all use for HDB :D
what they can do is perhaps, add in another condition, not the highest bidder will get; but the developer must also come with social economic impact (add in social values). A greener environment, a elderly friendly project, a development which promote 3 or more generation living, etc...that will be a good starting point.:o
Don't be silly.... gahmen will not say no to increasing revenue. Hey, the civil servants need to beat inflation with their salaries too right?
As it is, bus captains already too lowly paid.
Cleaners and healthcare salaries cost are going to go up.
Plus infra still not up to the mark need additional $ pump in to improve.
MP and public officials quality lack lustre, full of scammy character, so need more moolah to attract real talents with upright characters.
Where else to get the money from for all these and more?
I just effectively about to clean out my CPF OA right on the dot 2 Jan 2013.
But I thought CPF OA 2.5% beats loan interest? Leave inside CPF better or use it better?
phantom_opera
13-12-12, 10:55
from the chart bro chestnut posted, it took 4y to go from 6 to 4% last time :D
phantom_opera
13-12-12, 10:57
But I thought CPF OA 2.5% beats loan interest? Leave inside CPF better or use it better?
of course use it better, use 70% of your CPF OA to buy 5% yielding bond that is owned > 50% by Temasek and 30% into STI ETF, otherwise if real inflation is 6% you lose 6-2.5% = 3.5% pa
They did it from 10% to 8% in 2 years.
8% to 6% is difficult but not impossible. Another 3 years?
So 2015 Mr B will resurface...:banghead:
Bro, I did not say impossible. I am only measuring the difficulty. And yes, u got my point. It will be achieved!!!!! US will return to its former glory eventually. Of course along with China.
ya, not saying that you are right...then a lot of ppl would be silly dreaming that land cost can be curbed like what you just said. property price will cheong for sure....:D
Don't be silly.... gahmen will not say no to increasing revenue. Hey, the civil servants need to beat inflation with their salaries too right?
As it is, bus captains already too lowly paid.
Cleaners and healthcare salaries cost are going to go up.
Plus infra still not up to the mark need additional $ pump in to improve.
MP and public officials quality lack lustre, full of scammy character, so need more moolah to attract real talents with upright characters.
Where else to get the money from for all these and more?
Bro, I did not say impossible. I am only measuring the difficulty. And yes, u got my point. It will be achieved!!!!! US will return to its former glory eventually. Of course along with China.
USA is like an aging rockstar (michael jackson, elvis presley). She worth more dead than alive. USA will only rise up when they break up into separate states. Far too long USA live like a drug addict junkie (addicted to debt). How many drug addict that u know can really recover?
phantom_opera
13-12-12, 11:18
USA is like an aging rockstar (michael jackson, elvis presley). She worth more dead than alive. USA will only rise up when they break up into separate states. Far too long USA live like a drug addict junkie (addicted to debt). How many drug addict that u know can really recover?
Bernanke just provided another shot in US arm last night
you can check out anytime you want but you can never leave :p
Keeping the land cost flat is almost impossble unless no more bidding and all use for HDB :D
what they can do is perhaps, add in another condition, not the highest bidder will get; but the developer must also come with social economic impact (add in social values). A greener environment, a elderly friendly project, a development which promote 3 or more generation living, etc...that will be a good starting point.:o
won't change the price. seasoned developers will bid high high, come up with eco friendly architecture like marina bay area, make it more snazzy with all those social themes, and pass all this extra cost to the buyers.
we will be back to square one.
USA is like an aging rockstar (michael jackson, elvis presley). She worth more dead than alive. USA will only rise up when they break up into separate states. Far too long USA live like a drug addict junkie (addicted to debt). How many drug addict that u know can really recover?
Then why we always see if us got QE or not? Why we wait for Bernanke to talk? Who is an arms "super power"? Which country has all the IT standards? Who is the largest consumer today? Why Lehman kana down, the whole world shake? Who owes the world a lot of money?
In Singapore, do u see many us companies or European coys or china coys or other nations coy???
:cheers4: :cheers4:
Then why we always see if us got QE or not? Why we wait for Bernanke to talk? Who is an arms "super power"? Which country has all the IT standards? Who is the largest consumer today? Why Lehman kana down, the whole world shake? Who owes the world a lot of money?
In Singapore, do u see many us companies or European coys or china coys or other nations coy???
:cheers4: :cheers4:
Digress a bit, maybe not really. A friend recently turned down local MNC offer for China MNC offer. The China co actually better package.
Digress a bit, maybe not really. A friend recently turned down local MNC offer for China MNC offer. The China co actually better package.
china is playing catch up. plus they have the $$$$. so just whack top dollar, get top talent and cheong all the way to the top. if it's money problem, no big problem.
china is playing catch up. plus they have the $$$$. so just whack top dollar, get top talent and cheong all the way to the top. if it's money problem, no big problem.
Frankly want to join. Join now. Tge Chinese employer perception are still no good. Later when they appear better they wont pay top dpllor any more.
Digress a bit, maybe not really. A friend recently turned down local MNC offer for China MNC offer. The China co actually better package.
Huawei???? Hahahahaha
https://www.youtube.com/watch?v=s8EIL8lMcYQ
Huawei???? Hahahahaha
top dollar isn't everything. business culture, organizational benefits still pales in comparison to US counterparts in general
Frankly want to join. Join now. Tge Chinese employer perception are still no good. Later when they appear better they wont pay top dpllor any more.
some good ones. personally i think lenovo is not bad. but then... you can never know what the chinese are planning. i have seen too many singporean top entrepreneurs also kenah con by them.
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