One hundred years of the Fed

Whilst the broader market began the Christmas trading week with further gains, perhaps most notable was the 100 year anniversary of the signing of the US Federal Reserve Act - Dec'23, 1913. For those in charge of the US currency, it has been a century of 'paper decay'.

Federal Reserve, Washington DC. Photo: RDSmith

Summary

*first, some interesting reading on the 1913 Act @ WIKI
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What can be said about the Fed that hasn't already been posted a million times on ten thousand other finance sites in the last few years?

All I would add is that the Fed remains a fascinating institution to watch. Of course, the two majors issues are that...

1. It sure isn't Federal.
2. It doesn't really have any reserves, at least not counting those paid for with new money created from nothing.

It remains a bizarre situation, but then...the notion of paper money itself is a bizarre..if 'useful' method to carry out transactions.


The Fed to be revoked within the next 5-10 years?

For some of the big thinkers out there, those who look at the grand picture, the issue of the Federal Reserve continuing to determine US monetary policy remains a huge question. There are plenty who are quietly suggesting it will all come to a crashing end when the next financial upset occurs.

Many are agreed, the 2008/09 wave was a mere warm up act, compared to what is eventually coming.

What is my guess? They'll print until the 'pitchforks are at the gates'. Of course, maybe they'll have made pitchforks illegal by that point, kinda like what Spain now seems intent on.

A few interesting videos...

First, Mr Swann...but more importantly..featuring Mr Griffin..author of 'The Creature from Jekyll Island' - a must read book in my view for anyone interested in their history.


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Second video, somewhat kooky, but a fairly reasonable summary/history of the Fed.



You know, I really would like to watch the above alongside the Bernanke. I'd have a thousand questions for him. Then again, what would Yellen say?  Surely they have both watched a little of these sort of videos?
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Finally..a fun video from the two bears.


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Meanwhile..in market land...

As for the market, the post QE-taper rally looks fine into mid/late January. By then, the monthly charts will be offering as high as sp'1875/1900.

sp'weekly8 - mid term bullish outlook

Looking ahead

Tuesday will see some housing data, and Durable Goods Orders, with an early close at 1pm.

*there is no sig' QE until January.
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Goodnight from a stormy London