Enclosed please find you monthly stipend. You may notice that the envelope is a little light this month. You've gotten used to $85 billion and it is "only" $75 billion and worse, likely to get smaller over the next few years. The good news is that we've successfully hoodwinked the public. We were getting some flak for these transfers and "ongoing bank giveaways at unprecedented levels" was not a defensible way to sell it. Boy we are good. You still get $75 billion and we get applauded for "tapering." WTF is "tapering?" Damned if we know but they bought it.
Anyway, happy holidays. Don't spend it all in one place. Wait, who are we kidding? You aren't spending any of it instead prefering to collect the extra 1/4% on excess reserves. That and bonuses of course. No problem there. Don't forget we are sending someone over in a few months. He needs a job. With big bonuses.
Kindest Regards,
The Fed
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From Business Insider: Here's Why The Market Surged On Today's 'Taper' Announcement
So let's break down what that means:
-- The reduction in purchases is very small.
-- The Fed has said in the past that it would not consider raising rates until the unemployment rate fell to 6.5% but today the language is indicating that they'll wait until unemployment falls significantly below that before they consider raising rates.
-- The Fed will not raise rates as long as inflation is super-low.
-- There's no target date to ending QE, even though the taper has begun.
Ugly Climate Models
The Intergovernmental Panel on Climate Change can't explain the last 15 years.
Both the model's projections and actual temperatures rose during the latter half of the 20th century.
As evidence that the models "reproduce the general features" of actual temperature trends, the new report provides a handy graph comparing projections made in the panel's previous report with three different temperature records. The report says "the trend in globally-averaged surface temperatures falls within the range of the previous IPCC projections."
But is that so? Most temperature records show that since 1998 the models and observed average global temperatures have parted ways. The temperatures in the models continue to rise, while the real climate has refused to warm up much during the last 15 years.
The IPCC report acknowledges that almost all of the "historical simulations do not reproduce the observed recent warming hiatus." Not to worry, it assures us; 15-year pauses just happen...
Richard Florida, Mr. Creative Class, Is Now Mr. Rust Belt But he's not sorry about Brooklynizing your neighborhood
Few purveyors of big ideas have as much riding on a single notion or catch phrase as Richard Florida does with the “creative class.” Florida’s idea of a group of highly mobile, Mac-toting professionals driving economic development has sold him a lot of books, spurred a lucrative speechmaking and consulting career, and gotten him a well-paid perch at the University of Toronto. As important, it has given the admittedly status-conscious academic—previously, an anonymous professor in Pittsburgh—a kinship with the progressive elites that his theory affirmed.He is our premier celebrity urbanologist, whose home page features a clip of Bono mentioning him on a panel with Bill Clinton.
All of which explains the awkwardness of the current moment for Florida: His theories about how to boost city economies have, quite simply, been discredited. Rather than provide universal uplift, as he promised in his 2002 treatise, The Rise of the Creative Class, the clustering of high-earning professionals in areas rich in his “three T’s” of technology, talent, and tolerance has exposed inequalities both between and within cities.
https://www.google.com/search?q=%22Richard+Florida%22+site%3Aexurbannation.blogspot.com&ie=utf-8&oe=utf-8&aq=t&rls=org.mozilla:en-US:official&client=firefox-a
I've had Richard Florida dead to rights for many years. Classic Cenurbanist BSer.
10y T: 2.92 Not good. Funny thing, over at CR/HCN nary a word about bad housing and bad Philly Fed.
The clustering of high-tech is especially apparent in the LA area. Silicon Beach (SM, Venice, Marina Del Rey) is booming, other areas are getting drained. I'm not optimistic about downtown LA - Some buildings (such as the US Bank tower) are still half empty.
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