The first two are well known, being Fed’s employment objective and inflation control, its dual mandate empowered by congress. The third one is bond market, as I thought.
Since US monetary system was debased from gold standard, US government’s “control” (for lack of a better word) of banks, and banks control of economy, is basically based on treasury bonds, with Fed’s policy implemented via the purchase and sale of T bonds among Treasury, Fed, banks, and the rest of bond market such as PIMCO, with an average daily volume of $501B, 7 times of that of US stock market. So, when Bill Gross and his alike claimed that they cannot make “structural profits” under current yield curve and economy needs a rate cut, Fed listens.
Once on “three representations”, we have to talk about CCP and its “three representations”. Although always seemingly formidable and infallible, CCP faces an equally daunting challenge when trying to make their “three representations” work.
“As of July 2006, the Chinese population was 1.3 billion, which is more than four times as large as the
Because of this and other reasons, CCP and US have to work very closely with each other in many areas where both of them are “stakeholders”, such as purchase and sale of US T bonds, some kind of “order” for US dollars, some kind of USD-pegged currency system in Asia, and of course, Iran, N. Korea, etc.
Interestingly, when stock market corrected last year, all gold bugs and dollar bears came out crying, as if the end of world was coming. This time, they all seem unusually quite. I guess they somehow figured out, that with Comrade CCP and Uncle Sam in alliance, there is a thick resistance line atop of
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