Comments on: Central banks aren’t always a stabilizing presence in the market http://blogs.cfr.org/setser/2009/01/05/central-banks-arent-always-a-stabilizing-presence-in-the-market/ Sat, 21 Nov 2009 16:40:10 -0500 http://wordpress.org/?v=2.8.4 hourly 1 By: Brad Setser: Follow the Money » Blog Archive » Not necessarily always stabilizing … http://blogs.cfr.org/setser/2009/01/05/central-banks-arent-always-a-stabilizing-presence-in-the-market/#comment-133550 Brad Setser: Follow the Money » Blog Archive » Not necessarily always stabilizing … Fri, 24 Jul 2009 03:33:04 +0000 http://blogs.cfr.org/setser/?p=4350#comment-133550 [...] banks rather suddenly stopped buying Agency bonds, pushing Agency spreads up — at least until the Fed stepped [...] [...] banks rather suddenly stopped buying Agency bonds, pushing Agency spreads up — at least until the Fed stepped [...]

]]> By: GloboTrends Community http://blogs.cfr.org/setser/2009/01/05/central-banks-arent-always-a-stabilizing-presence-in-the-market/#comment-122484 GloboTrends Community Fri, 16 Jan 2009 23:45:29 +0000 http://blogs.cfr.org/setser/?p=4350#comment-122484 [...] portfolio. Central bank holdings of Treasuries at the Federal Reserve Bank of New York continue to rise rapidly. As of now, I would argue the available evidence suggests that China’s appetite for [...] [...] portfolio. Central bank holdings of Treasuries at the Federal Reserve Bank of New York continue to rise rapidly. As of now, I would argue the available evidence suggests that China’s appetite for [...]

]]> By: Brad Setser: Follow the Money » Blog Archive » China hasn’t (yet) lost its appetite for US Treasuries … http://blogs.cfr.org/setser/2009/01/05/central-banks-arent-always-a-stabilizing-presence-in-the-market/#comment-121852 Brad Setser: Follow the Money » Blog Archive » China hasn’t (yet) lost its appetite for US Treasuries … Thu, 08 Jan 2009 14:57:31 +0000 http://blogs.cfr.org/setser/?p=4350#comment-121852 [...] portfolio. Central bank holdings of Treasuries at the Federal Reserve Bank of New York continue to rise rapidly. As of now, I would argue the available evidence suggests that China’s appetite for [...] [...] portfolio. Central bank holdings of Treasuries at the Federal Reserve Bank of New York continue to rise rapidly. As of now, I would argue the available evidence suggests that China’s appetite for [...]

]]> By: Chris http://blogs.cfr.org/setser/2009/01/05/central-banks-arent-always-a-stabilizing-presence-in-the-market/#comment-121673 Chris Tue, 06 Jan 2009 18:52:30 +0000 http://blogs.cfr.org/setser/?p=4350#comment-121673 Thanks Thanks

]]> By: bsetser http://blogs.cfr.org/setser/2009/01/05/central-banks-arent-always-a-stabilizing-presence-in-the-market/#comment-121656 bsetser Tue, 06 Jan 2009 16:36:46 +0000 http://blogs.cfr.org/setser/?p=4350#comment-121656 Billions of dollars. I rarely graph % changes (except for export/ import graphs). Most of my capital flows/ current account graphs are in either $ billion of a % of US or world GDP. Billions of dollars. I rarely graph % changes (except for export/ import graphs). Most of my capital flows/ current account graphs are in either $ billion of a % of US or world GDP.

]]> By: Chris http://blogs.cfr.org/setser/2009/01/05/central-banks-arent-always-a-stabilizing-presence-in-the-market/#comment-121650 Chris Tue, 06 Jan 2009 15:50:51 +0000 http://blogs.cfr.org/setser/?p=4350#comment-121650 What are the Y axes? Billions of dollars? Percent change? Something else? What are the Y axes? Billions of dollars? Percent change? Something else?

]]> By: Brad Setser: Follow the Money » Blog Archive » Looking back at 08; thinking about 09 http://blogs.cfr.org/setser/2009/01/05/central-banks-arent-always-a-stabilizing-presence-in-the-market/#comment-121648 Brad Setser: Follow the Money » Blog Archive » Looking back at 08; thinking about 09 Tue, 06 Jan 2009 15:19:49 +0000 http://blogs.cfr.org/setser/?p=4350#comment-121648 [...] CIC’s investment in Blackstone would lead, indirectly, to SAFE’s decision to stop adding to its Agency portfolio? Talk about a bank shot. At the end of 2007 there was a sense that China might stop buying Agencies [...] [...] CIC’s investment in Blackstone would lead, indirectly, to SAFE’s decision to stop adding to its Agency portfolio? Talk about a bank shot. At the end of 2007 there was a sense that China might stop buying Agencies [...]

]]> By: Fugger http://blogs.cfr.org/setser/2009/01/05/central-banks-arent-always-a-stabilizing-presence-in-the-market/#comment-121636 Fugger Tue, 06 Jan 2009 10:45:16 +0000 http://blogs.cfr.org/setser/?p=4350#comment-121636 Central banks (in currencies other than their own) have removed huge amounts of liquidity from the money markets since August 2007 as they have become very risk averse. There is a nice irony in comparing their liquidity withdrawal with the liquidity provision by central banks in their own currencies. Of course, the central banks withdrawing liquidity are generally from different countries to those adding it. Examples of the withdrawal of liquidity include: - the switch from 3-12 month unsecured bank deposits (often placed via the BIS) to short term government bond repo; BIS provides some great data on this in its quarterly reviews - stopping lending their Treasury bonds in H2 2008, causing the fails in the Treasury repo market (a vicious circle as stopping lending led to fails led to reduced lending - all exacerbated by the lack of penalty for failing when interest rates are very low, which is now being addressed). Central banks (in currencies other than their own) have removed huge amounts of liquidity from the money markets since August 2007 as they have become very risk averse. There is a nice irony in comparing their liquidity withdrawal with the liquidity provision by central banks in their own currencies. Of course, the central banks withdrawing liquidity are generally from different countries to those adding it. Examples of the withdrawal of liquidity include:
- the switch from 3-12 month unsecured bank deposits (often placed via the BIS) to short term government bond repo; BIS provides some great data on this in its quarterly reviews
- stopping lending their Treasury bonds in H2 2008, causing the fails in the Treasury repo market (a vicious circle as stopping lending led to fails led to reduced lending – all exacerbated by the lack of penalty for failing when interest rates are very low, which is now being addressed).

]]> By: adiemuso http://blogs.cfr.org/setser/2009/01/05/central-banks-arent-always-a-stabilizing-presence-in-the-market/#comment-121629 adiemuso Tue, 06 Jan 2009 05:58:08 +0000 http://blogs.cfr.org/setser/?p=4350#comment-121629 ying i agree with you. the poor and middle gets marginalised.. however, sad but true, the ideal case only happens in Utopia. look at how they managed to bailout the rich folks, be it in US or UK or even in Asia. ying i agree with you. the poor and middle gets marginalised..

however, sad but true, the ideal case only happens in Utopia.

look at how they managed to bailout the rich folks, be it in US or UK or even in Asia.

]]> By: Anticipation http://blogs.cfr.org/setser/2009/01/05/central-banks-arent-always-a-stabilizing-presence-in-the-market/#comment-121624 Anticipation Tue, 06 Jan 2009 03:18:01 +0000 http://blogs.cfr.org/setser/?p=4350#comment-121624 twofish>>which leads us to the next question, what are we actually hoping for with a say "800B Obama Stimulus"? borrow more and spend more on what was actually spent in the past? Thus the cycle continues in hopes to ignite the same motor which drove us down the path we are on and refuse to swerve off, until... twofish>>which leads us to the next question, what are we actually hoping for with a say “800B Obama Stimulus”? borrow more and spend more on what was actually spent in the past?

Thus the cycle continues in hopes to ignite the same motor which drove us down the path we are on and refuse to swerve off, until…

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