Goldman: All Those Strange Things Happening in Markets Could Help Keep Interest Rates Low
New banking rules introduced in the aftermath of the financial crisis are contributing to a tightening of financial conditions.
What a December Fed Rate Liftoff Means for Equities
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Ingredients for the Goldman Sachs Financial Conditions Index: Take a liberal heaping of 10-year U.S. Treasury yields (36.5 percent), a generous portion of BBB-rated nonfinancial credit spreads (29.7 percent), a dollop of the credit risk indicator known as the TED spread (15.8 percent), a bit of the price-earnings ratio on the S&P 500 (4.7 percent), a dash of the Goldman Sachs broad trade-weighted dollar index (7.9 percent), and a sprinkle of the federal funds rate (5.5 percent).
Mix it all together and you should get something that looks like this: