The proliferation of negative interest rates

Weekly Update

June 17, 2016 Update


The stock market comes to dislike central bank policies

There are increasing calls for the Federal Reserve to step aside and let the market do its thing. Oh sure, there have long been the Fed doubters who despised the central bank intervention in bond markets, which in turn heavily influenced stocks and other assets. But those voices were largely drowned out as stocks roared higher and the Fed appeared to have successfully put a sturdy floor under the markets with ultra-low interest rates as the fuel. Markets are now telling the Fed that they’ve had enough, however, of the easy money policies of global central banks. With interest rates now negative across wide swaths of the global government bond market as German bonds went negative just this week. (more…)