Ben Bernanke's 2012 Jackson Hole Speech on Additional Policy Accommodation, Fiscal Cliff

Federal Reserve at Night (source: dctim on Flickr)
You can read Federal Reserve Chairman Ben Bernanke's full 2012 Jackson Hole speech below, but here is where he talked about "additional policy accommodation" and dealing with the fiscal cliff, which didn't really spark a rally in the markets if you remember. Today the market is rallying because the ECB outlined its sterilized bond purchasing plan for euro area sovereign debt. $SPY (the S&P ETF) just made a new bull market high today at $143.73. Central Banks are running the entire market at this point. Good luck!

Bernanke on monetary policy going forward:

"As we assess the benefits and costs of alternative policy approaches, though, we must not lose sight of the daunting economic challenges that confront our nation. The stagnation of the labor market in particular is a grave concern not only because of the enormous suffering and waste of human talent it entails, but also because persistently high levels of unemployment will wreak structural damage on our economy that could last for many years.

Monetary Base/GDP Ratio Trends in Japan, U.S., Euro Area, and UK From 1995-2011

U.S. Adjusted Monetary Base/GDP since 1929 (St. Louis Fed)
In a speech given by Bank of Japan governor Masaaki Shirakawa at a conference sponsored by the Federal Reserve Board and International Journal of Central Banking on March 24, 2012 (Central Banking: Before, During, and After the Crisis), he presented a bar chart that compared the monetary base/nominal GDP ratio trends in Japan, the U.S., Eurozone, and the UK from 1995 to 2011. Look how Japan's monetary base/GDP ratio grew from below 10% in 1995 to about 25% in 2011, and how the U.S. grew from about 5% in 1995 to above 15% in 2011. Will the U.S. monetary base/GDP hit 25%+? To your right is a chart of the Adjusted U.S. Monetary Base/Gross Domestic Product ratio since the Great Depression.

"Capex Orders Signal Weaker Investment Activity" (UniCredit Chart)

I found an August 24 research note by Dr. Harm Bandholz, chief U.S. economist at UniCredit, that had a chart comparing the year-over-year percent change in capex orders (nondefense capital goods orders ex aircraft) versus investment activity (equipment and software) from 1996-2012. In July, capex orders fell 6.2% year-over-year (61,152 in 2012 vs. 65,197 in 2011 in millions), which was the first YoY decline since 2009. It was also a low not seen since February 2011 (59,452). Here was his outlook and the chart.

Mysterious Domain Name Heist!

*UPDATE 9/12/2012*: I finally got my DistressedVolatility.com domain name back in my GoDaddy account after 15 days. Thank you Google Enterprises for resolving this issue as quick as possible and for keeping me in the know. And thank you @GoDaddy for responding to all of my complaints on Twitter. Keep a close eye on your domain names people.

I'm having a mysterious domain ownership issue. My DistressedVolatility.com domain name on GoDaddy expired even after I paid $10 to renew it through Google Apps (a GoDaddy partner). And I was never notified that an error occurred. I'm still waiting to hear from a specialist team at Google to figure out what happened. In the meantime, old posts with internal links beginning with 'distressedvolatility.com' are being redirected to Cing.com, a daily deals startup site like Groupon it looks like (Dealing with deal websites, SunTimes, 2/24/2012). So, to not get redirected to Cing.com, you will have to change old links on old posts to 'distressedvolatility.blogspot.com' for now. Nothing has changed with the blog layout or content. I was redirecting the 'distressedvolatility.blogspot.com' address to 'distressedvolatility.com' the whole time, which is an option on Blogger. Sorry to all who have been redirected to that site. Hopefully this gets resolved ASAP and I won't have to start up a new blog from scratch.