The hottest Monetary Policy Substack posts right now

And their main takeaways
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Top Finance Topics

Bitvana or the bitcaust

Gray Mirror • 51 implied HN points • 22 Mar 23
🔮 Crypto Bitcoin Cryptocurrency Financial system Monetary Policy
  1. Belief in financial systems is crucial for their stability - don't always trust the doomsayers predicting collapse.
  2. Understanding the true nature of inflation and the power of the Fed in the financial system provides insight into market dynamics.
  3. Capital flight to assets like Bitcoin can occur due to factors like dilution, destruction, and compression - but the end game must be stability to be effective.

Clouded Judgement 11.8.24 - Q3 Earnings + Fed Update

Clouded Judgement • 5 implied HN points • 08 Nov 24
💰 Finance Economics Investing Earnings Monetary Policy Market Trends
  1. The Fed has lowered interest rates by 0.25%, now sitting at 4.5% - 4.75%. This move aims to support economic growth and labor market stability.
  2. Software companies reported strong Q3 earnings, with all 29 companies exceeding estimates. There's a positive trend in guidance for future quarters as well.
  3. Overall, companies in the software sector are seeing good growth in metrics like Annual Recurring Revenue (ARR), which suggests a brighter outlook for the industry.
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How the Banking System Changed Post-SVB

Apricitas Economics • 32 implied HN points • 05 Jun 23
💰 Finance Banking System Economic Analysis Financial Institutions Risk management Monetary Policy
  1. After the collapse of Silicon Valley Bank, the American banking industry is adapting by relying less on uninsured deposits and more on alternative funding methods like borrowings.
  2. Deposits have restabilized post-SVB crisis, but banks are facing challenges with tight lending standards due to renewed economic pessimism and liquidity concerns.
  3. Banks are cautiously navigating post-SVB crisis by reducing reliance on uninsured deposits, managing securities losses, and addressing liquidity worries amid tighter monetary policy.

Clouded Judgement 12.20.24 - The Fed Bomb

Clouded Judgement • 3 implied HN points • 20 Dec 24
💰 Finance Monetary Policy Market Trends Economic Indicators Investment Analysis Stock Valuation
  1. The Federal Reserve is expecting fewer interest rate cuts in 2025 than many had hoped. They now see only two cuts instead of three or four.
  2. The Fed raised its inflation projections, indicating that inflation might be a bigger problem than previously thought. This caused a noticeable drop in market values.
  3. Economic growth estimates for 2025 have improved slightly, but the Fed suggests it will be cautious moving forward, making investors nervous.

Guan Tao on the yuan's exchange rate as an asset price

Pekingnology • 15 implied HN points • 13 Feb 24
💰 Finance Financial Stability Monetary Policy
  1. China's Renminbi exchange rate is now seen as an asset price, showing characteristics of asset pricing and requiring an understanding beyond traditional commodity money views.
  2. The flexibility of the Renminbi exchange rate helps release pressure, acts as a shock absorber, and ensures market resilience in the face of fluctuations.
  3. Maintaining a flexible exchange rate policy supports China's pursuit of institutional openness, providing coordination between development and security.

Rate hikes and the damage to our national productivity

Klement on Investing • 6 implied HN points • 18 Jan 24
💰 Finance Investing Monetary Policy Productivity Research & Development Stock Market
  1. Central banks have been implementing aggressive rate hikes to control inflation, leading to a reduction in investments in research and development (R&D).
  2. Rate hikes negatively impact corporate spending on R&D, resulting in a decline in innovation, lower productivity growth, and slower job creation.
  3. To counteract the adverse effects of rate hikes on R&D, fiscal policy measures supporting R&D efforts, like the Inflation Reduction Act, are crucial for boosting productivity and maintaining competitiveness.

Why is Gold Such a Reliable Measure of Value?

Economic Forces • 3 implied HN points • 22 Feb 24
💰 Finance Economics Gold Price theory Monetary Policy
  1. Gold has historically maintained its value, with an ounce consistently able to buy a good suit, showcasing its reliability as a measure of value.
  2. On the gold standard, dollar value was linked to a set amount of gold, ensuring a stable price for gold over time.
  3. Fluctuations in the supply and demand of gold do not impact the long-term value of gold as a reliable measure of value.

Fiscal rules are good rules

Klement on Investing • 2 implied HN points • 01 Feb 24
💰 Finance Monetary Policy
  1. Fiscal rules can help keep government spending in check and reduce borrowing costs for countries and states
  2. Strict fiscal rules can eliminate political business cycles where deficits grow before elections
  3. Countries with strict fiscal rules tend to have stronger long-term GDP growth compared to those with lax rules

Russian Banking's Birth by Mutiny

Vivid Leaves • 4 implied HN points • 26 Jul 23
💼 Business Banking Economics Transition Infrastructure Monetary Policy
  1. The collapse of the Soviet banking system birthed the modern Russian banking system through a series of rebellions and creation of new banks.
  2. The Soviet economy transitioned from a market vacuum to a market economy due to cooperative entities and the birth of private commercial banks.
  3. Formation of the Central Bank of Russia and rapid bank privatization led to a banking system with significant infrastructure challenges and financial instability.

Lawler: Some Thoughts on Quantitative Easing and Quantitative Tightening

CalculatedRisk Newsletter • 1 HN point • 04 Mar 24
💰 Finance Economics Monetary Policy Interest Rates Market Analysis
  1. Quantitative Tightening (QT) involves reducing the Federal Reserve's balance sheet, but it is not a complete reversal of Quantitative Easing (QE).
  2. QE involved purchasing assets to influence interest rates, like putting pressure on long-term interest rates to stimulate the economy.
  3. The impact of Fed Treasury and MBS purchases has significantly altered the maturity profile of government obligations held by the private sector and influenced interest rates.

SVB’s Failure and the Lack of Reserve Requirements

Satiation Point • 1 HN point • 25 Mar 23
💰 Finance Regulations Reserves Banking Monetary Policy Financial Crisis
  1. SVB's failure had multiple causes, including heavy investment in risky assets and inadequate insurance for deposits.
  2. Abandoning reserve requirements for banks may have contributed to the recent bank run crisis.
  3. Increasing required reserve ratios above zero could help prevent similar crises by ensuring banks hold more funds to satisfy depositors.

Discover the Secret Role of US News in Driving Global Markets and Make Money Investing Now

The Tweetsift Report • 0 implied HN points • 02 Mar 23
💰 Finance Investing Monetary Policy Global Markets
  1. US news has a significant impact on driving global financial markets and equity prices.
  2. US monetary policy influences commodity prices, exchange rates, and various asset prices.
  3. The unique position of the US economy drives the asymmetrical effects of US and foreign news releases on financial markets.

The Unraveling of the Soviet Ruble Zone

Vivid Leaves • 0 implied HN points • 07 Oct 23
🌍 World Politics Banking System Central Bank Monetary Policy
  1. The collapse of the Soviet ruble zone was like a heist more than a historical event, with countries exploiting the payment network to issue new rubles and ultimately leading to hyperinflation.
  2. The failure of the Soviet ruble zone showed the importance of payment networks in shaping path dependencies, highlighting the need for robust state capacity and careful negotiation in managing currency transitions.
  3. Countries like the Baltics and Ukraine left the Russian ruble zone early, showing the impact of geopolitical decisions on monetary systems.

CBDCs: Sleepwalking to Tyranny

The Otonomist • 0 implied HN points • 31 Jan 24
💰 Finance Cryptocurrency Government Control Monetary Policy
  1. Central Bank Digital Currencies (CBDCs) can give governments too much power over individuals' financial activities and privacy.
  2. CBDCs aim to replace physical cash with digital currency issued by central banks, potentially streamlining payment systems and enhancing financial inclusion.
  3. Concerns about CBDCs include privacy risks, security vulnerabilities, and the potential for state control over spending and savings.

Monetary Policy Report 2022: Key Findings and Future Projections

The Tweetsift Report • 0 implied HN points • 03 Mar 23
💰 Finance Monetary Policy Economic projections
  1. The Federal Reserve projects lower interest rates and a strong fourth quarter ahead.
  2. The US economy shows weaknesses in areas like the labor market, but also has positive indicators like job gains and moderate inflation.
  3. The 20 bullish cases for a bright economy highlight strong labor demand, wage growth, business investment, and credit availability.

Some simple economics of ICOs

Joshua Gans' Newsletter • 0 implied HN points • 19 Mar 18
💰 Finance Monetary Policy Market Analysis Startups
  1. Initial Coin Offerings (ICOs) have raised billions for startups but there is concern about fraud and lack of incentives for startups to deliver on promises.
  2. ICOs can help startups reveal demand for their services early on and aggregate information from buyers and speculators.
  3. Monetary policy plays a role in ICOs when there is a need to raise a large amount of money up front, affecting the timing of revenue generation.

Why the Fed fears cutting interest rates too soon

Global Markets Investor • 0 implied HN points • 08 Feb 24
💰 Finance Monetary Policy Inflation Interest Rates Economic History
  1. The Fed fears cutting interest rates too soon due to concerns about a potential inflation resurgence similar to the 1970s.
  2. The Federal Reserve in the 1970s under Arthur Burns made a significant policy mistake by cutting interest rates too soon, leading to high inflation rates later.
  3. Lessons from history emphasize the importance of not cutting interest rates prematurely, and the Fed is cautious about considering rate cuts until more data is available to assess inflation and economic indicators.

Is there a signal in the noise? Yield Curves, Economic Growth and Stock Prices!

Musings on Markets • 0 implied HN points • 07 Dec 18
💰 Finance Economic Indicators Investment Strategies Monetary Policy Stock Market
  1. Yield curves can give clues about the economy, but they are not always reliable predictors. It’s important to consider all the data when interpreting changes in the yield curve.
  2. The short end of the yield curve seems to have a stronger link to economic growth, while the long end shows little correlation. This suggests that short-term rates are more significant for understanding economic trends.
  3. In recent years, the relationship between yield curves and economic performance has changed. It's essential to be cautious when using past indicators to predict future markets, as the economic environment is different now.

Negative Interest Rates: Impossible, Unnatural or Just Unusual?

Musings on Markets • 0 implied HN points • 11 Mar 16
💰 Finance Interest Rates Investing Economics Monetary Policy Financial Markets
  1. Negative interest rates are a real phenomenon, where borrowing costs can drop below zero. This happens when people expect prices to fall and aren't willing to wait to consume.
  2. Central banks can't just force interest rates to stay negative; they influence rates through market signals and buying bonds. If people don't trust these banks, rates may not behave as expected.
  3. Negative rates can hurt the real economy since people might avoid investing. This uncertainty can lead to higher risk in financial markets as investors chase after returns.

Full Summary of Powell Testimony & Transcriptions: Fed's Pressure from Democrats and Republicans on Monetary Policy and Climate Regulations

The Tweetsift Report • 0 implied HN points • 08 Mar 23
🇺🇸 U.S. Politics Monetary Policy Federal Reserve Democrats Republicans
  1. The Federal Reserve is facing pressure from both Democrats and Republicans on monetary policy and climate regulations.
  2. Chairman Powell testified before the Senate about the impact of monetary policy on economic activity and inflation.
  3. The Fed is working on instant payment services and discussing potential changes in capital requirements for banks.