Royal Bank Of Scotland Share Discussion Threads

[leedskier] 15/9/2015 08:44

AV.Bloomberg - H&M Sales Growth Slumps to Two-Year Low Amid Hot German Summer

[leedskier] 15/9/2015 08:29

Emerging markets have accumulated $7.5 trillion of external debt and are acutely vulnerable to a rapid rise in US interest rates, regardless of whether they borrowed in dollars or their own currencies, Fitch Ratings has warned.
The credit agency said international markets are pricing in a much slower pace of US monetary tightening than the US Federal Reserve itself, risking a potential financial upset in East Asia, Latin America and Africa if Fed hawks refuse to bow to market pressure over the next two years.
Fitch said the Fed has signalled a rise in rates to 3.8pc beyond 2017 but investors simply refuse to believe that this will happen, with futures contracts implying rates of just 1.4pc over the same span – an unprecedented gap of 240 basis points, and one that is fraught with risk.

[maxk] 15/9/2015 08:24

Corbyn is doing a sterling job, Call Me is exstatic.

[leedskier] 15/9/2015 07:59

Hmmm so according to the Guardian, the FED is now tipped by the majority of economists to raise rates!

[leedskier] 15/9/2015 07:58

Guardian ....

Sharp falls in petrol prices are expected to have pulled UK inflation back down to zero in August, economists predict ahead of the latest official figures today.

Financial markets will be looking to inflation data at 9.30am for clues as to when the Bank of England will start raising interest rates after more than six years at their record low of 0.5%. The US Federal Reserve is expected, by a slim majority of economists, to hike its main interest rate this week, but experts believe the UK’s central bank will wait until at least the end of the year to follow suit.

If forecasters are right about August inflation in the UK, that could ease the pressure

[leedskier] 15/9/2015 07:47

Given the heightened anxiety it would be surprising if it was blue this morning.

[leedskier] 15/9/2015 06:59

Ramco, I heard a comment ... on a live link ... that the FED had the opportunity to raise rates in H1 before China imploded, but 'missed that chance', having missed that chance is it going to compound the error by raising them during a time of heightened Global risk?


As you comment it is now in a lose/lose situation.

[leedskier] 15/9/2015 06:53

LONDON, Sept 15 Financial spreadbetters predicted Britain's FTSE
100 to open 15 to 19 points higher, or as much as 0.3 percent, Germany's
DAX to gain 38 to 47 points, or as much as 0.5 percent, and France's
CAC 40 to rise 22 to 27 points, or as much as 0.6 percent, on Tuesday.

[ramco] 15/9/2015 02:33

Think about it this way. If it has historically taken 11 quarters to fall from an economic growth rate of 3% into recession, then it will take just 1/3rd of that time at a rate of 1.2%, or 3-4 quarters. This is historically consistent with previous economic cycles, as shown in the table to the left, which suggests there is much less wiggle room between the first rate hike and the next recession than currently believed.

It is there that we find the Fed's dilemma:

"There is clearly something amiss within the economic landscape, and the ongoing decline of inflationary pressures longer term is likely telling us just that. The big question for the Fed is how to get out of the potential trap they have gotten themselves into without cratering the economy, and the financial markets, in the process.

...the Fed understands that we are closer to the next economic recession than not. For the Federal Reserve, the worst case scenario is being caught with rates at the "zero bound" when that occurs. For this reason, while raising rates will likely spark a potential recession and market correction, from the Fed’s perspective this might be the 'lesser of two evils.'”

[ramco] 15/9/2015 02:25

Adding colour to the occasion....;

So, while the Fed keeps suggesting the economic growth and inflationary pressures are "just around the corner;" such hopes have remained elusive over the last few years.....

If we look at both GDP growth and Fed Funds data, which dates back to 1943, and calculate both the average and median for the entire span, we find:

The average number of quarters from the first rate hike to the next recession is 11, or 33 months.
The average 5-year real economic growth rate was 3.08%
The median number of quarters from the first rate hike to the next recession is 10, or 30 months.
The median 5-year real economic growth rate was 3.10%

However, there have only been TWO previous points in history where real economic growth was below 2% at the time of the first quarterly rate hike - 1948 and 1980. In 1948, the recession occurred ONE-quarter later and THREE-quarters following the first hike in 1980.

In other words, the Federal Reserve is considering tightening monetary policy at a time when average real economic growth is less than half the level of previous rate hiking campaigns......

[ramco] 15/9/2015 02:10

GS has been busy today...apart from finding out that they are the perpetrators of what is effectively a jihad against savers ongoing, have apparently invented still another ruse to keep the Fed doing Wall Street’s bidding, and to thereby keep its wretched jihad fully in force.....

....they also just came out with this...

While equities do tend to be lower one-, two-, and three-months after a Fed rate hike, S&P 500 realized volatility and VIX levels have been fairly well contained. However, Goldman Sachs warns not to expect VIX to calm down and settle back into the low teens like it was from 2013 to mid-August 2015. New normal trend VIX levels should now be 4-5 points higher than the average level of 14 experienced in 2013-2014 given the current state of the economy.

Add: trust you have been enjoying VIX Dope....;)

[ramco] 15/9/2015 02:04

On your comments...

The USD strengthening since last July is the core driver of the global recession. Is the Fed insane enough to deepen the global recession by raising rates and pushing the U.S. dollar even higher? Who wins if the USD strengthens due to the Fed raising rates? In a globally interconnected economy, nobody wins....

[ramco] 15/9/2015 02:00

Following on with my theme from at least a full two quarters ago about where we will probably be about now saw this in print today....;

The real risk for the Federal Reserve is keeping interest rates at zero and the deflationary feedback from the collapse in commodity prices, and the Chinese economy trips the U.S. into a recession. Given that "QE" programs have no real effect on boosting economic growth, the Fed would be left with virtually no "effective" monetary policy tools with which to stabilize the economy. For the Fed, this is the worse possible outcome.

[leedskier] 14/9/2015 22:17

Only if the FED raises rates.

[ball deap] 14/9/2015 22:08

I sed frum strt rech for door , open door bail out of door. Testicle tinglingly low share price levels are to be seen soon.

[begorrah88] 14/9/2015 14:20

Looks like any Santa rally will try and get the FTSE and banks back to their dizzying heights of June.I wonder if we have reached the point where the machines are in control and nobody knows how to fix it.

[leedskier] 14/9/2015 14:13

3. Fed countdown: Analysts and economists are eagerly awaiting the upcoming meeting of Federal Reserve members on Wednesday and Thursday. A decision on interest rates will come out Thursday and is sure to have an immediate impact on the markets."The decision itself is arguably more important for the markets than anything else we've seen so far in 2015," said Angus Campbell, senior analyst at FxPro."There is still a minority that is of the view that the [Fed] will announce a [rate] hike this Thursday, but it's hard to see how a hike now will help investors given all that the financial markets have been though in the past few weeks, in particular emerging markets."

[leedskier] 14/9/2015 14:06

But as long as the majority of the Fed say 'No', we yet see a rally in Q4.What the World needs is inflation. That requires the USD to fall.

[leedskier] 14/9/2015 14:03

It seems not agree with GS about the Fed holding off."Stanley Fischer offered a word to the wise in 2014 that resonates today as he and other Federal Reserve officials face their toughest decision in years -- the benefits of waiting can be overrated.Slowing economic growth abroad and volatile stock prices at home are prompting some U.S. central bankers to rethink whether now is the best time for the first interest-rate increase since 2006. One option, says former Fed Vice Chairman Donald Kohn, would be to put off a move at this week's meeting to get a clearer view of the outlook. Investors seem to agree, putting a 70 percent chance of no move on Sept. 17."

[leedskier] 14/9/2015 13:42

I see there has been a coup in Australia.The new PM, Malcolm Turnbull, read law at Oxford and qualified as a barrister before moving into finance.

[leedskier] 14/9/2015 13:40

I think that sentiment in the City is very weak.There was an expectation in 2009 that normality would resume in a couple of years.Then in 2011, the German Eurozone austerity plan kicked in leading to recessions, deflation and the rest.Inevitably China was going to suffer with much of the EU so weak for so long.Draghi needs to fire up the EZ, or it could be like this for for years to come.Add to which, in London, deposit taking banks are so constrained they are no longer players in the equity markets.