The Fed Has Moved the Goalposts: Cortes

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Dec. 18 (Bloomberg) – Veracruz TJM Founder Steve Cortes and Bloomberg’s Barry Ritholtz and Julie Hyman discuss Fed tapering and interest rates with Trish Regan and Adam Johnson on Bloomberg Television’s “Street Smart.” (Source: Bloomberg)

That thought, steve, we are getting some perspective on standout.

I want to bring up the treasury market again.

Rates on the 10 year were around two point 88%. remember, we have not seen -- remember, the market really reacted more negatively back in may, when we first started talking about tapering when the rates shot up and stocks came down at that point.

Since then, because we have been talking about tapering for so long, we have not really seen that shoot up.

I was say to a lot of people that a lot of people thought it was built in for spring.

2014? at this point we were up to 50-50. understand what the fed did.

They are buying $10 billion less.

Still 75 billion dollars per month.

That is a huge stimulus to keep rates relatively modest.

And they moved the goalposts.

This is no longer a hard target, they said.

No longer a hard target, to clarify, no longer raising rates when it drops, they said it would have to go below.

And they did not say how far, so they have really given themselves infinite room to continue qe.

I think nothing is changing.

We are getting ben bernanke 2.0. a shorter, female version of an bernanke.

Come on.

That is actually a very important point.

If you look back at greenspan, he was a hero at the time but now a lot of people blame him for the asset bubble of 2008. do you think we could face a similar situation?

I think so.

The fed has proven that it is a bubble machine.

I believe there is risk.

Not one that is cataclysmic right now, because there is not nearly as much leverage, but is this bubble territory?

I think so.

People have been calling for this for years.

This text has been automatically generated. It may not be 100% accurate.


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