Tag Archives: ZIRP

Have Governments And Banks Learned Nothing From The 2008 Financial Crisis?

Government Bonds And Consumer Debt Levels Soar While Bailouts Remain The Norm! This is an excellent read from an article at City Journal! These are some of the general takeaways… Some Key Points: ‘Bailouts remain the norm worldwide’ ‘In 2008, the world’s major central banks held little more than $6 trillion in assets, according to […]

Is The US Real Estate Market Facing A New, Post-Financial Crisis, Chapter Of Moral Hazard?

housing market moral hazard

With the US housing market having recouped most of its pre-financial crisis price levels (exceeded in some markets) in conjunction with the Federal Reserve having engaged in ZIRP (zero interest rate policy) for an extended period of time, is the market once again facing a moral hazard? First, how would one define moral hazard vis a vis the real […]

The Central Bank Casino…BOJ, Fed, Real Estate And Mortgage Rates!

Zirp and Nirp

(Note: This article also appears at econintersect.com) This week both the Bank of Japan and the Federal Reserve will be meeting to chart the future course of interest rates! In the U.S. where prior to the recent small interest rate hike ZIRP or zero interest rate policy had been in place, speculation over whether the Fed will raise or stand […]

The Credit Suisse Fear Barometer Hits A Record High!

VIX,fear index

Summary: With the VIX near its lows why are there two so very different sides to the same coin? For those unfamiliar with the Credit Suisse Fear Barometer it is another metric for gauging investor angst and expectation! Knowledge Is Power – Francis Bacon To the everyday stock market watcher the most commonly used metric for […]

Pssst…You Want To Buy A Car?

subprime

‘Are ‘Almost’ Subprime Mortgages And Used Car Loans A Canary In The Coal Mine?’ Having lived through the lending environment that led to ‘The Big Short’, one has to wonder whether we are heading back in the same direction! George Santayana (circa early 1900’s): ‘Those who cannot remember the past are condemned to repeat it.‘ […]

Insurer Survivability: (More) Unintended Consequences Of ZIRP And NIRP!

ZIRP AND NIRP! For potential property buyers and current owners of property who are thinking of refinancing a mortgage, ZIRP has been, and NIRP may someday be, fantasticmonetary policies! ZIRP? NIRP? For those unfamiliar these acronyms are not the sounds an infant might make but instead are deadly serious policies that are being used by central bankers around the world in […]

Subprime Mortgages – They’re Ba-ack!

1

Summary: With an eight-year easy money policy from the Federal Reserve (ZIRP) and real estate prices in some regions above pre-financial crisis highs, subprime mortgages are making a comeback! Subprime mortgage loans yes, but apparently not in the pre-2008 financial crisis form of ‘Liar Loans’! Liar Loans: ‘A category of mortgages known as low-documentation or no-documentation […]

Ticking Time Bomb In Your States Pension Fund? (Chart)

Summary: State pension funds have a serious underfunding issue! It’s ZIRP but it’s more! The potential time bomb of underfunded state pension funds lurks quietly in the background, unseen and unknown by most! But like most issues that are ignored and that grow in size anyway, they don’t go away but become known only when they reach […]

Question: Can ZIRP + Recession = Economic Death Spiral?

This is a question worth pondering particularly with the rampant speculation over what the Fed will do with interest rates this month! First the obvious thought, what is ZIRP? In a nutshell…’Zero interest-rate policy (ZIRP) is a macroeconomic concept describing conditions with a very low nominal interest rate, such as those in contemporary Japan and, […]