In the first few months of the year, a trading desk rumor emerged that even as institutional traders dumped stocks and retail investors piled into ETFs, a "mystery" central bank was quietly bidding up risk assets by aggressively buying stocks.
Authored by Simon Black via SovereignMan.com,
This week, the world of banking and finance waited with baited breath for the Federal Reserve in the United States to hike… or not to hike… interest rates.
This happens several times each year as the central bank’s Federal Open Market Committee gathers to set monetary policy in the Land of the Free.
To be clear, there is no greater power over a nation than having control of its money supply and interest rates.
After the abysmal March labor report, all we - and the Fed - can say is that April better be good, or else Yellen's claim of "transitory weakness" will simply be the latest nail in the coffin of Fed credibility. Here is the consensus for the key numbers the BLS will report at 8:30am ET on Friday morning.
While we doubt anything material will emerge for various obvious reasons, the NY Post reports that the DOJ is probing Goldman Sachs for alleged Treasury auction rigging: the charge is that Goldman, one of the 23 US primary dealers, won almost all Treasury bond auctions from 2007 to about 2011 even after the Treasury department established safeguards to maintain competitiveness. The case is said to center on chats and emails showing Goldman traders sharing price information with traders at other banks:
After two years of recurring warnings (both on this website and elsewhere) that Canada's largest alternative (i.e., non-bank) mortgage lender is fundamentally insolvent, kept alive only courtesy of the Canadian housing bubble which until last week had managed to lift all boats, Home Capital Group suffered a spectacular spectacular implosion last week when its stock price crashed by the most on record after HCG revealed that it had taken out an emergency $2 billion line of credit from an unnamed counterparty with an effective rate as high as 22.5%, indicative of a business model on the verge