Phillips/Krupa at GS note exhaustion of emergency measures to avoid the debt ceiling could arrive earlier than expected. Insurance costs have risen to above 2011 levels.
Category Archives: financial markets
Guest Contribution: “In god we trust, all the others must bring (good) collateral”
Today, we are pleased to present a guest contribution by Miklos Vari (Banque de France). The views expressed herein are those of the author and should not be attributed to the Banque de France or the Eurosystem.
How To Calculate the Upper Bound Estimate on After Tax Real Mortgage Rates
“After tax mortgage rates are well below inflation—IOW negative real rates. A helluva deal!”
Contra this comment, the data suggests otherwise.
Spreads, Breakevens, and Risk/Uncertainty as of End-March
Buffeted by SVB, income and spending, and PCE releases.
Stress
St. Louis Financial Stress and Chicago Financial Conditions Indices.
“Forecasting Summer School: Modeling and Forecasting the International Dimensions”
That’s the title of the 6th annual Forecasting Summer School, June 24-25, at the University of Virginia Darden School of Business, Charlottesville, where I’ll be the instructor. The deadline in March 27.
What Would Interest Rates Have to Be for Unrealized Losses to Be Zero
Consider the following graph of unrealized losses on securities held by reporting banks (from Rupkey/Financial Markets This Week):
How Unique Was SVB?
Pretty unique, in terms of size, and the combination of uninsured deposits and held-to-maturity securities. From the Economist:
Recession Chances: Fed Pause vs. Banking Shock
Goldman Sachs raised the probability of recession from 25% to 35% in light of the SVB related turmoil (although their guess is still lower than the consensus). This prompted me to wonder what was the net effect of the turmoil and Fed response (less tightening) on economic activity.