The Fed Is Pushing on a String

Moody’s Investors Service  has boosted its outlook on the U.S. banking system. A “stable” designation applied Tuesday replaces the negative outlook the ratings agency has had on the sector since the financial crisis of 2008. Moody’s cited continued improvement in the operating environment and reduced risk of a faltering economy as the reasons for the change. U.S. banks are now even better positioned to face any future economic downturn

A Federal Reserve panel of bankers warned policy makers in February that record stimulus was pushing financial institutions to take on more credit risk and creating a “bubble” in the price of U.S. farmland.

With the release of the BLS' report for 2011 on the Characteristic of Minimum Wage Earners, we can now update our pioneering chart illustrating how the federal minimum wage-earning composition of the U.S. workforce has changed in each year since 2006.

David Goldman submits: Yesterday morning I wrote, “the prudent thing to do is to increase cash positions.” I have been selling off my gold and commodities inflation hedges aggressively since then. The world has told the United States in effect that it will not absorb the monetary inflation that the Fed promised with QE2. The result is a wintry deflationary wind blowing across all markets.

By Simon van Norden Today, we're fortunate to have Simon van Norden, Professor of Finance at HEC Montréal (École des Hautes Études Commerciales), continue as a guest contributor. In my previous post, I wrote about some of the evidence linking serious banking crises to real estate market collapses.