Tag Archives: Robert Eisenbeis

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The FOMC, March 2019

Author: Robert Eisenbeis, Ph.D., Post Date: March 27, 2019
Federal Reserve - FOMC

To no one’s surprise, the FOMC left its policy rate unchanged. This decision was widely telegraphed in advance. What was a surprise to many – but should not have been – was the mark-down in prospective rate changes to zero in 2019 and only one in 2020. Pundits puzzled over what had changed since the […]

The January 2019 Fed Minutes

Author: Robert Eisenbeis, Ph.D., Post Date: February 22, 2019
Federal Reserve - FOMC

Attention has turned to what extra gems of information might be contained in the release of the FOMC’s January 2019 minutes about the future path of policy. Comments have focused on the Fed’s balance sheet, the consequences of its runoff for financial markets, and what the Fed’s policies might be going forward in terms of […]

Taxing Wealth Instead of Income?

Author: Robert Eisenbeis, Ph.D., Post Date: February 13, 2019
Cumberland Advisors' Bob Eisenbeis

With the desire to finance both an increasing deficit and an increase in government services, politicians are searching far and wide for funds. Increasingly, proposals are surfacing to tax wealth rather than income as the means to fund pet projects. The proposals attract followers since unequal distribution of wealth is viewed as a problem that […]

Tax the Rich

Author: Robert Eisenbeis, Ph.D., Post Date: January 29, 2019
Cumberland Advisors' Bob Eisenbeis

As the political season begins to heat up for 2020, we have seen an increasing number of proposals to provide free education, free healthcare, a universal guarantee of a living wage, etc. With an historic level of public debt topping $21 trillion and a deficit of nearly $1 trillion and projected to climb even more […]

Can the President Fire the Chairman of the Federal Reserve?

Author: Robert Eisenbeis, Ph.D., Post Date: January 10, 2019
Cumberland Advisors' Bob Eisenbeis

The question has arisen, does the president have the ability to fire the chairman of the Federal Reserve. The short answer appears to be no. But few understand the structure of the Federal Reserve and how, by design, that structure both compartmentalizes and is designed to insulate policy making from attempts by outsiders to influence […]

Yogi Berra, the Fed’s Balance Sheet, and Liquidity

Author: Robert Eisenbeis, Ph.D., Post Date: December 28, 2018
Market Commentary - Cumberland Advisors - Yogi Berra, the Fed’s Balance Sheet, and Liquidity - The Fed’s Quantitative Easing Program

The story is that the Fed’s quantitative easing program injected large amounts of liquidity into financial markets, causing bond rates to fall and stock prices to accelerate. Consequently, the argument goes that, the shrinking of the Fed’s balance sheet through maturity runoff will cause bond rates to increase and, presumably, stock prices to retreat. But […]

Market Backlash

Author: Robert Eisenbeis, Ph.D., Post Date: December 21, 2018
Cumberland Advisors' Bob Eisenbeis

The Treasury market had priced in a 25-basis-point increase in the FOMC’s target range for federal funds prior to the FOMC’s December 18–19 meeting. The Committee was faced with essentially three policy options: Pause, deliver on the 25-basis-point increase and signal a pause, or deliver on the 25-basis-point increase and signal the willingness to continue […]

TNB and the Regulatory Dialectic

Author: Robert Eisenbeis, Ph.D., Post Date: December 13, 2018
Cumberland Advisors' Bob Eisenbeis

Back in the 1980s Professor Edward Kane coined the term regulatory dialectic to capture the dynamics of how regulated financial institutions found innovative ways to circumvent regulations designed to restrict their behavior. For example, banks adopted the one-bank holding company form in the late 1960s to avoid the restrictions on permissible activities. They subsequently used […]

The November FOMC and the Election

Author: Robert Eisenbeis, Ph.D., Post Date: November 2, 2018
Federal Reserve - FOMC

The November FOMC meeting is scheduled for November 7 & 8, one day after the November 6 midterm election. We are not looking, then, at the possibility of any further FOMC action on interest rates that might influence the election one way or another, but what about after the election? Is the FOMC likely to […]