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Powell: Time to Say Uncle? Not Yet
The central thesis of the last SriKonomics was that Federal Reserve Chairman had lost the central bank’s traditional ability to influence long-dated debt markets through statements and concrete actions. Speaking at the Economic Club of New York on October 19, he conceded that “it’s hard to say exactly what’s going on with long-term yields.” My conclusion in the writeup that went out a week ago was that such diffidence reduces the ability of monetary authorities to prevent a “credit event” following the sharp run-up in interest rates. Financial market developments over the past week go part of the way ... (full story)