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The Squawk Box Asia Interview

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This morning I spoke with the CNBC Asia Squawk Box team in their Singapore studio.

We discussed Fed Chairman Bernanke’s speech (which was taking place at that time) and what it suggests about when the Fed will begin to taper QE.

I hope you’ll check out this conversation by clicking on the link at the bottom of this page.

Also, let me remind you to subscribe to my video newsletter, Macro Watch:


The Squawk Box Asia Interview:



  1. What information did we miss because of the edit (cut) during your interview? Otherwise, an interesting interview. I noticed a change in your forecast of QE tapering. March is a little earlier than the recent Macro Watch – “no need for tapering until 2015”. With regards to a stock market bubble: from what I’ve seen over the last few months, the Fed is controlling any market excess by merely mentioning tapering. So far, it’s working very well – the market is incredibly sensitive to any reference to the “T” word. Can they keep “talking” it down? Is there another economic reason for tapering in March?

    1. You did not really miss anything because of the edit. Lisa stopped me mid-sentence because Bernanke started his speech just then and CNBC went live to his speech for a few minutes. They edited that out.

      Regarding tapering, thanks for bringing up that question. Tapering only means that the Fed will begin to print less money every month. Not that they will stop printing money. Now the Fed is printing $85 billion per month. So, when I said the Fed could begin to taper in March, I did not mean that the Fed will stop printing money altogether, only that they will begin to print less of it each month. I have not changed my opinion that QE will continue through at least 2015, at a pace of somewhere between $500 billion and $1 trillion a year. I did not have the chance to make that clear during the interview.

      Yesterday, the Minutes for the Fed’s October FOMC meeting were released. They suggested there is a reasonable possibility that the Fed will begin to taper even before March, possibly even at their next meeting on December 18th or at the meeting after that in January. So the next unemployment number to be released in early December will be important to watch. If it’s strong, taper will happen sooner.

      You’re right they have been pretty successful in talking down the stock market by just talking about tapering. But, I do think they are becoming a little nervous about how long this round of QE has been going on. But, on the other hand, the US and the global economy are still very weak, international trade is weak, commodity prices are falling and the US inflation rate, at only 1%, is below where they would like it to be. Deflation is a worry. So, the timing of the taper still depends on “incoming data” as the Fed keeps saying. But, as of today, it looks like tapering will begin by March at the latest.

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