Click to p. 2 of the Barron's article where it says
The logic for Annaly over American Capital Agency Corp. (AGNC) boils down to a longer history as a public company, a bigger market cap, and deeper trading liquidity.
So he's criticizing the lack of granularity with which the Fed would implement the easing. I suppose that's would be valid if he's suggesting a softer transition than Ben's approach might accomplish.
Go read Bernanke's comments again. 6.5% was his trigger for raising interest rates.
"For example, assuming that inflation is near our objective at that time, as expected, a decline in the unemployment rate to 6-1/2 percent would not lead automatically to an increase in the federal funds rate target, but rather would indicate only that it was appropriate for the Committee to consider whether the broader economic outlook justified such an increase. All else equal, the more subdued the outlook for inflation at that time, the more patient the Committee would likely be in making that assessment."
This isn't the reflexive trigger you claim.
He said it's not an automatic trigger for tapering. It's an automatic trigger for the committee to consider what step they might want to take.
1:04 pm A More Optimistic Fedby Sudeep ReddyAdd a Comment
The Fed statement is in. No change in policy, as expected, but the central bank sounds more optimistic about the economy and the labor market ahead. It says "downside risks to the outlook" have diminished since the fall. That keeps tapering of the Fed's bond-buying program in play for the fall.
Ben is on record, I believe, that fiscal policy would be needed eventually. My (cynical) guess is congress just waits until Ben retires so they can do nothing and/or blame Ben.
Saying they're "holding back" is unfair since they're not "due" to declare until around June 11. (The pattern is one week plus one calendar day before ex.) But yes, it would be nice of them to declare a cut when they know it.
21,740,000 shares. Last known BV was 28.93 ending Q1. May 17 sp closed at 29.65.
Hmmm... makes one think about current BV and if they're looking for a way to maintain current div, as div announcement is expected around June 11th-ish.
Agree there was nothing new said. I figure this was partly Wall $treet's way of acting out because they couldn't get a definitive nod on QE ending whilst away on their summer holidays.
I dunno about stopping caring about every meeting. Back in the Greenspam days you could hear a pin drop while people tried to decrypt his reports. But I think it's fair to say the market got woken up to the likelihood of change.