“…the Fed in good measure is the source of risk”, Jim Grant, Founder and Editor Grant’s Interest Rate Observer

Excerpt from Yahoo Finance’s “The Daily Ticker” Interview with Jim Grant, September 27, 2013:

Jim Grant: “The Fed believes that it is in charge. That it is Atlas with the weight of the world on its shoulders. This speaks to another risk. The Fed, as somebody once said to Alan Greenspan, how can you protect against systemic risk when you are systemic risk?  So, the Fed in good measure is the source of risk. It suppresses money market rates. It muscles around the yield curve. It talks up the stock market.  It does everything except let the price discovery mechanism do the work. So we are increasingly in a regime of price administration rather the price discovery.”

The Daily Ticker Interviewer: “And they don’t want to give it up?”

Jim Grant: “They do not…See, they claim they are data driven; not telling us, not reminding us that this data is subject to enormous revisions.”

Full video is available at Yahoo Finance: http://finance.yahoo.com/blogs/daily-ticker/no-fed-taper-jim-grant-131604213.html

Posted on September 27, 2013, in Postings. Bookmark the permalink. Leave a comment.

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