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Generally speaking, legislators backing laws like the one in North Carolina say that such legislation is intended to stop voter fraud, though the number of documented cases of in-person voter fraud suggests the crime is virtually non-existent in the U.S.
Suggesting that the November election might not be on the level is nothing new for Trump, who has regularly said that he expects the general election to be “rigged.” He has often expressed empathy for supporters of Sen. Bernie Sanders (I-Vt.), many of whom voiced similar complaints during the Democratic primary.
Rebecca is telling Dale and Darnell about how her mum knew when she slept with a boy for the first time. The boys tell Bex she has very white eyes. She launches into the tune "Bright Eyes" and they tell her to be quiet.
Editor’s Note: By all accounts, the Federal Reserve ended its bond buying program, known as quantitative easing, at its policy meeting at the end of last month. Over six years, the central bank bought $4.5 trillion worth of mortgage-backed securities and Treasury bonds. But since the beginning of this year, the Fed has...
It’s not that simple, though, says economist Terry Burnham. The Fed is continuing what he calls “Stealth QE,” or the purchase of more bonds with the interest the Fed earns on the bonds it has already purchased. In order to stop that, he writes, the Fed would need to shrink its balance sheet by the amount of interest th...
Burnham, a long-time critic of the Fed’s bond-buying program, is a former Goldman Sachs trader, biotech entrepreneur, money manager and economics professor at Harvard’s Business School and Kennedy School of Government. He now teaches at Chapman College. A frequent contributor to this page, he’s most famous for his pred...
Oct. 29, 2014 marked the end of the Federal Reserve’s historic program of quantitative easing, or QE, which created more new money in the past six years than in the entire history of the Republic. Easy-money has caused the U.S. stock market to soar. Beginning in December of last year, the Fed gradually retreated from i...
The preceding paragraph reflects the conventional wisdom; the global financial media have printed hundreds of similar paragraphs over the last few months.
What’s false? QE is over.
And what’s misleading? The monetary tightening of the QE “taper’ was gradual and has ended.
And the myth? QE causes the stock market to rise.
Image courtesy of Terry Burnham.
We are in the midst of an historic macroeconomic experiment. The U.S. government is pursuing three highly unusual policies: creating extra money, holding interest rates low, and spending far more than it collects. (Read my piece “The Dow may be above 17,000 but not for long” to understand the historic nature of current...
Imagine the termination of these macroeconomic policies as economic hurdles, which, if cleared without stumbling, could lead to a robust economy and further stock market gains.
Under quantitative easing, the Federal Reserve has purchased almost $4.5 trillion in Treasury and mortgage bonds. The Fed uses electronic money that it creates from nothing to make these purchases. To say that QE has been unprecedented is to understate the case, as the Fed bought less than $1 trillion in bonds between ...
If you put your money in a standard “interest-bearing” bank account you will earn $0 in interest. This is because the Federal Reserve controls a key, short-term interest rate, known as the Fed Funds rate. Short-term rates of all kinds are low because they have been influenced by the Fed’s zero interest rate policy. By ...
The U.S. federal government has added $10 trillion in additional debt in the last decade. This more than doubles the $8 trillion accumulated in the entire history of the country.
The combination of loose money and massive federal spending has never before occurred in the U.S., not even during the 20th century’s two World Wars or the Great Depression.
The end of QE will be important for two reasons. First, it will begin the process of unwinding these unusual policies — a significant event in itself. And second, it will be momentous precisely because no one knows what will happen.
With this backdrop, let us return to the falsehood, misconception, and myth contained in QE conventional wisdom.
These headlines proclaim QE done and gone. But they’re wrong.
“Stealth QE” continues. Stealth QE is the purchase of more bonds with the interest the Fed earns on the bonds it has already purchased.
The Fed earns about $100 billion a year in interest on its holdings. But in its recent statements, the Fed is silent about these interest payments. For example, the Oct. 29, 2014 FOMC statement — the one announcing an end to the asset purchases program — includes, “The Committee is maintaining its existing policy of re...
But stealth QE occurs regardless of what the Fed does with the interest it earns. If the Fed reinvests the interest it earns to buy additional bonds, then QE continues directly in the standard manner with an increase in the Fed’s balance sheet. If the Fed does not reinvest the interest, it simply sends the interest to ...
In order to stop stealth QE, the Fed would need to shrink its balance sheet by the amount of interest that it earns.
Alternate history headline: Federal Reserve begins MASSIVE bond buying program.
Consider what would have happened in 2005, for example, If the Fed had introduced a $100-billion-a-year program to buy bonds. We would have seen headlines announcing the historic event. Former Rep. Ron Paul, and other elected officials, would have excoriated the Federal Reserve chair in public hearings.
But now it’s 2014, and stealth QE isn’t likely to elicit much more than a yawn from the public because these ongoing purchases are so small compared with recent purchase amounts.
However, stealth QE is massive compared to Fed purchases up through 2007. For the first 94 years of its existence, the Fed bought an average of under $10 billion in bonds per year. So stealth QE has Fed activity running at 10 times its historical average.
Furthermore, stealth QE isn’t completely different in size from the second round of quantitative easing, begun in 2011. Under QE2, the Fed bought a total of $600 billion in additional bonds. It would take about five to six years for the Fed to amass that amount of bonds under stealth QE.
So, QE has not ended. Stealth QE continues, and it is significant.
Conventional wisdom argues that “taper tightening” began in December 2013 and is now over. Further monetary tightening, this thinking suggests, is on hold until sometime in 2015 when the Fed will likely raise the Fed funds rate for the first time since the crisis.
But this view ignores the lag in monetary policy. The Fed believes, for example, that low interest rates stimulate the housing sector and create housing-related jobs. However, jobs that arise from low rates may be created months or years after an interest rate decline; it takes time for people to make a decision, close...
When it comes to monetary policy we must always consider the lags. In the case of QE, the lagged effects are important because the recent purchases of bonds under the program have been massive. On Nov. 12, 2014 the Fed’s balance sheet was $4.49 trillion, up $600 billion from a year earlier.
Remember that the new bond buys in the past 12 months almost equal all Federal Reserve bond purchases between 1913 and 2007. There is a Mt. Everest-sized bolus of QE bond buys still working their way through the system with a lag.
Because monetary policy operates with a lag, many of any tightening effects caused by the reduction in QE have yet to come. Depending on the length of the lag, we may be less than halfway through the taper tightening.
The public has mixed feelings about QE. Gallup reports that only rich people have a favorable view of the Federal Reserve and former Chair Ben Bernanke. This may reflect the public’s belief that QE increases the stock market more than the real economy.
Graph courtesy of the author.
QE has been correlated with stock market gains. I believe, however, that any causal relationship is a myth. The first definition of myth in an online dictionary is, “a traditional or legendary story … with or without a determinable basis of fact.” Many people believe that QE supports the stock market, but there is no p...
What is the relationship between quantitative easing and the level of the stock market? The mythical explanation is: With quantitative easing, the Fed buys more bonds from individuals and institutions. The sellers of these bonds receive cash from the Fed. Some of that cash gets re-invested in the stock market. These ad...
The real world, however, may not work with mythical simplicity. While the stock market continues to exhibit a strong correlation with the Fed’s balance sheet, gold, oil and other commodities tell a different story.
The argument that QE increases the price of gold works exactly the same as the one for stocks. Because of QE, investors have more cash in their accounts; some of that cash gets invested in gold, causing gold prices to rise.
Beginning in 2011, however, gold prices and the Fed’s policy decoupled in a dramatic fashion. The Fed’s QE pace accelerated significantly yet gold prices plummeted. In rough terms, the Fed’s balance sheet has doubled while the price of gold has halved. Correlation is not golden causation.
Looking beyond gold, other commodity prices, like that of oil, demonstrate the same decoupling from the Fed’s balance sheet. Again, the simple logic argues that more QE leads to commodity inflation. However, commodity prices have fallen broadly, and dramatically, during the Fed’s most aggressive phase of QE.
Image courtesy of the author.
Since 2011, the CRB index, a broad measure of commodity prices, has dropped by 25 percent.
Gold, oil and other commodity prices were positively correlated with QE for years but fell dramatically even while the Fed was in the midst of a QE bond-buying bonanza. QE does not cause commodity prices to rise.
Perhaps commodities are a special case, whose price declines are explained by increases in supply and a slowdown in China.
Let us next consider Treasury bonds. In March 2011, Bill Gross, then leading PIMCO, predicted that bond prices would drop after the Fed ended QE2, the second round of bond purchases.
What could be more obvious. Under QE2 the Fed had been a HUGE purchaser of Treasury bonds. When demand plunges, it is reasonable to predict that prices will decline.
Financial markets are tricky because people set prices not economic models. Bill Gross’s QE2 call was reasonable, but it turned out to be 100 percent wrong (the fallout from this 2011 situation continues today with the anointing of a new bond king, Jeff Gundlach, to replace Bill Gross).
In summary, there is no simple relationship between QE and asset prices. Commodities, including oil and gold, have plummeted during the most sustained, aggressive phase of QE. Even bonds, the asset purchased by the Fed under QE, show no clear relationship with the Fed’s behavior. So that leaves us with one question.
Does QE cause stock prices to rise?
The logic that people use to explain a causal relationship between QE and stock prices does not work in other markets. We are left with no theory — just a correlation. Without a clear answer we are each free to come up with our own opinions.
I believe that the idea that the Fed is supporting stock prices is a myth that will be dispelled over time as stock prices and the Fed’s balance sheet diverge.
What will a divergence look like? Optimists believe that the stock market can continue to go up, even as the Fed dramatically slows QE. However, I continue to predict that the stock market will decline, and that this decline will persist even if the Fed restarts QE at even higher levels.
We are in the midst of the greatest macroeconomic experiment in the history of the Republic. “The End of QE” is symptomatic of the fog in which we live. Even issues that ought be clear are surrounded by myth, misconception and falsehood.
Left: The Federal Reserve is still engaging in what economist Terry Burnham calls "stealth quantitative easing." Photo by Flickr user Paul Nicholson.
Terry Burnham is a former Goldman Sachs employee, money manager, biotech entrepreneur and economics professor at the Harvard Business School. He’s the author of “Mean Genes” and “Mean Markets and Lizard Brains” and now teaches finance at Chapman University. You can follow him at www.terryburnham.com.
In that split second, I thought, what is this guy doing? There’s no way he’s going to have room to slow down, much less stop in time.
It was a day like any other day at work.
After a long, but good, day teaching video production and computer classes at ECS, my wife, Sherry, and boys Samuel, 13, and Zachary, 10, had just packed up and were ready to go home at about 4:30 p.m.
My mind was already on the next day’s worth of classes, and the upcoming weekend. I had just helped Sherry lock up her classroom, which was steps from the exit to the 3rd street parking lot.
We paused briefly at her door when she told me she forgot a water bottle in her classroom.
“Are you sure you don’t want me to get it? It will just take a second,” I asked.
“No, I’ll just get it tomorrow,” she replied.
With that, the four of us, plus one of the school's principals walked out the door as we had thousands of times over the last four years.
The boys ran ahead of us to the parking lot across a small footbridge that crosses a drainage ditch that borders the school. As usual, we followed behind, and turned briefly and saw no one was behind us.
We crossed the bridge as well, and then about 10 feet onto the sidewalk. I looked at one of our fellow staffers who was leaving the parking lot in her car and waved goodbye.
I took another few steps and then I heard a horn blare, and an engine rev like it was speeding up. I turned and saw a tan sedan race towards the school at what appeared to be 100 mph.
In the car it appeared to be only the driver, with both hands on the steering wheel.
In that split second, I thought, what is this guy doing? There’s no way he’s going to have room to slow down, much less stop in time. Stopping did not appear to what he had in mind.
I heard the engine race louder, as he floored it in the last few seconds before impact.
I remember screaming, “He’s going to hit it!” as he struck the base of the footbridge, which had an incline, and instantly became airborne, at least 10 feet or more above the ground.
The car clipped part of the fence on one side of the bridge and started to flip as it was launched into the air above the same walkway we had been seconds earlier. The entire top of the car slammed into the building, and embedded itself in the wall of a second story bridge that connects two parts of the school.
There was smoke, but no fire.
A half second later, windows on the second floor cracked, popped and smashed to the ground. The building alarm blared. I pulled my phone from my pocket, screamed at my boys to stay back and dialed 911.
The line rang three times, but did not connect. I saw that the principal was also calling 911, so I hung up, because by this time, dozens of students from second graders through high school were running to the scene to see what happened. One of the coaches who had been nearby at practice ran up with his medical bag to ...
I concentrated on trying to keep people away, afraid of what would happen next.
The phone rang again, it seemed like minutes had gone by. It was only 4:38 p.m.
I confirmed to the 911 operator that I had indeed meant to call 911, and we needed help fast. Help was already on the way, she explained, since multiple calls had already come in. Indeed she was right. Just then the first deputy arrived on the scene, and I explained that I saw her, and would hang up.
During those initial few minutes, I wondered who would do such a thing? Was the school being targeted? Why ECS? Was it a student, or adult? Were there any more people coming? Some answers were slow to come, some not at all.
I helped keep people back from the scene, dreading an explosion that never came.
Two separate parents who had almost been hit ran up. The faculty member who I had just waved at seconds before the crash came up and was shaking and crying. I asked if she had seen it, and she explained she had almost been hit, as the driver had accelerated towards the school. I hugged her, and was still in shock as to...
I thought of the driver and what his family would soon be going through. People may not believe in miracles, people may believe in random chance, but I will be the first to tell you that I lived one of God’s miracles on Wednesday at 4:37 p.m.
My miracle only needed to last about 10 seconds.
Todd Stubing is a computer skills and video production teacher at the Evangelical Christian School in Fort Myers. He's also is a former assistant photo editor and photographer for The News-Press.
The features draw upon Adobe's Sensei AI framework to let businesses analyze customer datasets, improve mobile experiences, and create custom data models.
A screenshot of the new Data Science Workspace feature from Adobe.
Adobe is rolling out analytics enhancements to the Experience platform, its customer experience management service. The creative software giant said it's adding more features that draw upon its Sensei AI framework to let businesses analyze customer datasets, improve mobile experiences, and create custom data models.
With a new experience query service, Adobe said businesses will be able to pull together siloed datasets across the Experience platform for improved analysis. The service will also provide data scientists with a standard query language to manage the datasets as well as the querying capabilities to translate the data in...
Meanwhile, new mobile capabilities on the platform will let businesses use Launch by Adobe as an SDK management system, enabling app developers to activate marketing features within apps with one SDK. Adobe said teams can also browse, configure and deploy SDKs from Adobe and third-party developers via an app-store like...
The company is also introducing new ways for data scientists to surface insights in large data sets. With Data Science Workspace, available today, data scientists can access their datasets in Adobe Experience platform to create and train custom data models. Data scientists can either use pre-built models or create cust...
Adobe also said it's been granted a patent for a framework that will help brands manage data compliance. The planned Data Usage Labeling Enforcement (DULE) framework will become part of the Experience platform as a way for brands to marketing actions comply with data usage policies, the company said.
The new Experience features coincide with the release of Adobe's new AI Assist tool, which aims to help customers uncover currently unknown insights and understand business context.
The vulnerabilities resolved in the update impact both Microsoft Windows and Apple MacOS systems.
The software giant said the cloud update aims to serve the roughly 50 percent of consumers that say they still prefer to receive brand offers via email.
The iPhone SDK event isn’t the only live blogging event today (though it did successfully bully HP Labs out of a morning timeslot), CG is live at a big event held at HP Labs, one of the biggest research organizations in the world. Looks like what’s on the docket is a big re-organization: with focus going towards more p...
2:57pm: Q&A over. Now to see some demos!
2:55pm: What ideas are going to get killed? 150 down to 20-30 — HP is not saying which. Currently reviewing which to get the axe.

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