Central banks shift into shares as low rates hit revenues

[Demon of Light]

Central banks around the world, including China’s, have shifted decisively into investing in equities as low interest rates have hit their revenues, according to a global study of 400 public sector institutions.


“A cluster of central banking investors has become major players on world equity markets,” says a report to be published this week by the Official Monetary and Financial Institutions Forum (Omfif), a central bank research and advisory group. The trend “could potentially contribute to overheated asset prices”, it warns.


Central banks are traditionally conservative and secretive managers of official reserves. Although scant details are available of their holdings Omfif’s first “Global Public Investor” survey points out they have lost revenues in recent years as a result of low interest rates – which they slashed in response to the global financial crisis.

Source: Financial Times

The Fed is not mentioned, but it can safely be presumed they are one of the other major buyers. Your "recovery" ladies and gentlemen.

 

[CalGun]

And how would they define equities?

REITs are an equity,
Derivatives some believe are an equity,
Bonds of course,
What about loan guarantees?

I wouldn't trust what comes from them very far, but it would trust they hope to maintain the status quo as,long as possible for after that life will be a lot different and a lot less enjoyable.

Source: Financial Times

The Fed is not mentioned, but it can safely be presumed they are one of the other major buyers. Your "recovery" ladies and gentlemen.

 

[Khayembii Communique]

Source: Financial Times

The Fed is not mentioned, but it can safely be presumed they are one of the other major buyers. Your "recovery" ladies and gentlemen.

The audited Fed financial statements are available here:
FRB: Fed financial statements - Credit and Liquidity Programs and the Balance Sheet

You can look at their balance sheet yourself if you want. If the Fed was purchasing stocks it would first off be huge news, and second off probably show up on their balance sheet in a specific, descriptive line item. As of year end 2013 there is no such line item.

 

[Deuce]

The audited Fed financial statements are available here:
FRB: Fed financial statements - Credit and Liquidity Programs and the Balance Sheet

You can look at their balance sheet yourself if you want. If the Fed was purchasing stocks it would first off be huge news, and second off probably show up on their balance sheet in a specific, descriptive line item. As of year end 2013 there is no such line item.

I prefer wild speculation and doomsday predictions, thank you.

 

[d0gbreath]

If true, it's possible that the FDIC would have to file for bankruptcy if the market were to crash. 1929 all over again.

But wait: If they were too big to fail then we could um... ....print more money!

 

[Demon of Light]

The audited Fed financial statements are available here:
FRB: Fed financial statements - Credit and Liquidity Programs and the Balance Sheet

You can look at their balance sheet yourself if you want. If the Fed was purchasing stocks it would first off be huge news, and second off probably show up on their balance sheet in a specific, descriptive line item. As of year end 2013 there is no such line item.

Of course, they would not have a line item saying "stocks" or "equities" as that would give up the ghost. There are ways to conceal it.

 

[Khayembii Communique]

Of course, they would not have a line item saying "stocks" or "equities" as that would give up the ghost. There are ways to conceal it.

Yes, Deloitte is in on it. Give me a break.

 

[Demon of Light]

Yes, Deloitte is in on it. Give me a break.

It would hardly be the first time they covered for people they were auditing:

Deloitte settles in Adelphia scandal - FinanceGates.com

http://www.chinadaily.com.cn/bizchina/2006-03/31/content_556998.htm

Standard Chartered: Deloitte rejects US claims - Telegraph

They can give a fully accurate report that is, simultaneously, completely deceitful.

 

[Khayembii Communique]

This thread should probably be moved to the conspiracy theories forum at this point.

 

[Demon of Light]

This thread should probably be moved to the conspiracy theories forum at this point.

The article points out the Chinese, Danes, and Swiss, are buying stocks through their central banks, yet you call it a conspiracy theory to suggest the Federal Reserve might be doing the same? Garbage. Deloitte has "missed" things before during their audits and pretty big things at that. Whether they were complicit or just negligent in those past cases, it does not inspire confidence that their audit would explicitly single out something of public interest. Your faith in the system is completely unwarranted.

 

[DA60]

The article points out the Chinese, Danes, and Swiss, are buying stocks through their central banks, yet you call it a conspiracy theory to suggest the Federal Reserve might be doing the same? Garbage. Deloitte has "missed" things before during their audits and pretty big things at that. Whether they were complicit or just negligent in those past cases, it does not inspire confidence that their audit would explicitly single out something of public interest. Your faith in the system is completely unwarranted.

yes, if the Japanese Central Bank can invest in their equities market AND Yellen has stated her support for Abenomics - why is it illogical that the Fed might pursue the same course?

It's funny, every time Keynesian-lovers like KC cannot adequately spin a big government-negative report...they immediately call it a conspiracy and ask the mods to move it to the conspiracy section.

I think you struck a nerve.

Anyone that thinks the audits that the Fed releases give a complete picture of what the Fed does and/or spends money on simply does not know what they are talking about.

Just ask the Belgians if the Fed can buy/get others to buy things 'off the books'?


When will the world face facts - the Fed are macroeconomic ignoramuses that have not a clue what they are doing and are just trying to put out every new fire that starts to begin.
The Fed are great bean counters...but HORRIBLE economists.

Anyone that doubt's it need only look at the Fed minutes in 2007 as the housing market started to collapse...they were clueless as to the extent of what was going on - including Yellen.

http://www.cbsnews.com/news/transcripts-show-fed-in-2007-underestimated-crisis/

These glorified bank managers have not a clue what they are doing (IMO)...and yet they are the most powerful economic organization on the planet.

 

[Khayembii Communique]

The article points out the Chinese, Danes, and Swiss, are buying stocks through their central banks, yet you call it a conspiracy theory to suggest the Federal Reserve might be doing the same? Garbage. Deloitte has "missed" things before during their audits and pretty big things at that. Whether they were complicit or just negligent in those past cases, it does not inspire confidence that their audit would explicitly single out something of public interest. Your faith in the system is completely unwarranted.

Yes, it is a conspiracy theory because you are theorizing that the Fed is secretly conspiring to purchase stocks and hide it off their financials, and that Deloitte is in on this conspiracy.

 

[Khayembii Communique]

yes, if the Japanese Central Bank can invest in their equities market AND Yellen has stated her support for Abenomics - why is it illogical that the Fed might pursue the same course?

It's funny, every time Keynesian-lovers like KC cannot adequately spin a big government-negative report...they immediately call it a conspiracy and ask the mods to move it to the conspiracy section.

There's no news here. I think it's possible that the Fed could get into that practice, though I don't think it will actually happen, and if it does it will be public knowledge because the Fed is very interested in being open about its monetary policy.

The issue isn't whether or not they could, it's if they're doing it right now. And saying that they're doing it right now, in secret, and that one of the largest accounting firms in the world is in on this secret, is the conspiracy.

Anyone that thinks the audits that the Fed releases give a complete picture of what the Fed does and/or spends money on simply does not know what they are talking about.

The financial statements speak for themselves. There aren't any stocks on its balance sheet. Simple as that. I'm sorry that you think they are some big scary villainous organization that's bent on...whatever the hell you believe they're bent on, but you just sound silly.