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Summers Pulls Out Of Consideration To Head Fed - Bad News For Savers

Sunday, September 15, 2013 - 6:32 PM
Larry Summers has withdrawn from consideration to be named to head the Fed when Bernanke leaves in January. That pretty much means Janet Yellen will take over a chairwoman of the Fed.

Larry Summers pulls out of running to be Federal Reserve chairman - latimes.com

Yellen is generally believed to be more likely to keep interest rates low than Summers would be -- bad news for savers.
5
me1004me1004370 posts since
Jan 16, 2010
Rep Points: 2,568
1. Sunday, September 15, 2013 - 6:45 PM
You can forget about any increase in yields. Stocks surge on more free money.

Dollar Sinks, S&P 500 Futures Rise on Summers; Oil Slips - Bloomberg

“It’s widely believed she [Yellen] will continue Bernanke’s pro-growth policies, if not taking a more aggressive stance,” wrote Rivkin analyst Tim Radford in reaction to the news.

“By Summers pulling out of the race there is now a great deal of certainty over the future of U.S. Federal Reserve monetary policy moving forward,” he said.

Pension Partners chief investment strategist and contributor to MarketWatch’s Trading Deck column  Michael Gayed wrote on Twitter following the news that “Yellen pretty much guarantees prolonged [quantitative easing] and liquidity. Weak dollar, strong emerging markets.”

Dollar falls as Summers quits race to lead Fed - Currencies - MarketWatch

I guess that makes 2% long-term yields look pretty good.
3
ShorebreakShorebreak2,607 posts since
Apr 6, 2010
Rep Points: 14,112
2. Sunday, September 15, 2013 - 11:03 PM
“I believe that banking institutions are more dangerous to our liberties than standing armies.” – Thomas Jefferson
2
loulou543 posts since
Aug 3, 2010
Rep Points: 3,392
3. Sunday, September 15, 2013 - 11:10 PM
This is a very ominous sign for the govt money printing operation:

Foreign appetite for U.S. debt has shriveled, and over the past 12 months foreign purchases of Treasuries have declined to $104 billion from $503 billion a year earlier.  Since the Fed began talking about tapering, foreigners have turned net sellers of Treasuries.
3
loulou543 posts since
Aug 3, 2010
Rep Points: 3,392
cumuluscumulus330 posts since
Jan 16, 2010
Rep Points: 1,554
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