Posted on 05/06/2015 10:49:36 AM PDT by xzins
Federal Reserve Chair Janet Yellen on Wednesday described stock market valuations as high and said the central bank was carefully monitoring their impact on financial stability.
"I would highlight that equity market valuations at this point generally are quite high," Yellen said in conversation with Christine Lagarde, managing director of the International Monetary Fund, at an economics conference.
Coupled with weak economic reports in the morning, her remarks drove stocks broadly lower in Wednesday trading.
Yellen added, however, that the overall risks to financial stability are "moderated, not elevated" and she does not see the hallmarks of any bubbles.
She cited one reason stock prices were high: the meager returns on safer investments such as bonds because of low interest rates.
"But there are potential dangers there," Yellen said.
The very low level for short-term and long-term interest rates represented a risk because rates can move rapidly, she explained.
Banking regulators are remaining "watchful" for any areas where further reforms may be needed, she said. Yellen cited the need to address the problem of "too big to fail" — the perception among investors that some institutions are so large that the government will step in and save them if they get into trouble.
The Fed and other regulators are taking steps to ensure that the collapse of even very large banking institutions can be handled in ways that don't jeopardize the stability of the entire system.
(Excerpt) Read more at finance.yahoo.com ...
we all can see and assess stock prices for ourselves without need of such ‘helpful’ advice
is she just bozo or what’s her agenda?
From the article...
“Yellen added, however, that the overall risks to financial stability are “moderated, not elevated” and she does not see the hallmarks of any bubbles”
If she can’t see bubbles, she needs a seeing eyed dog
I predict 50%
Wonder if it ever occurred to her that the problem is actually that the value of her money is quite low.
A fair point. If my 100 dollars is worth only 99 dollars next year, then my 100 dollar gold coin should bring me 101, if I want to stay even.
Maybe Yellen will restart Nixon’s “Whip Inflation Now” program. Except she will jawbone hedge funds.
She is—as Nixon was—spitting into the wind so long as her Fed keeps interest rates at 0%.
Look at the “great minds” that are “in charge” of our financial system (two pathetic socialists from academia):
Yellin and Christine LaGarde of the IMF!
Instead of Yellin saying “stock valuations are high” she should be saying “we have a government bubble” as Peter Schiff says.
In recent decades it’s been the Fed that’s triggered stock market crashes.
“Irrational exuberance”?
We could become Haiti overnight... they can't 'borrow their way out of debt' and we won't be able to either.
50% might be a bit much, a DOW correction down to 14,500 is more likely.
If interest double, our debt will equal our military budget. If it triples, it will equal our social security budget.
I saw someplace that if it doubles, then the interest on the debt will equal all income tax collections in 20 years if we continue each year borrowing a third+ of the budget.
For your consideration...
Try at least half.
The only reason the market is so high is because of low, all but negative, interest rates. Any sign or even signal of a rate change to the positive sends the DOW south like a duck in winter.
and they call themselves ‘’Regulators’’..
more like Obammy,, it ought be ‘Instigators’..
She would be serving us all better if she stayed in hiding,, a lot.. and muted.
Tell us something we didn’t know Janet. Like you have a clue what to do about it. She’s even worse than Bernanke.
The New Age of Economic Totalitarianism & the London Meeting to End Currency
I have been warning that the governments of the West are in severe trouble. We face the worst economic crisis, perhaps in modern history, with the distinct risk of moving into a state of Economic Totalitarianism. The governments are well aware of the Economic Confidence Model (ECM). Many people have questioned, “Why have they not killed you?” since it appears that most of the others central to events covered in the movie “The Forecaster” are dead. I believe the answer is rather simple, for even when I was released and appeared on Capitol Hill, I was introduced as the guy with the model they are trying to suppress.
Government is not a single entity. The forces I stood up against were restricted to the corruption in New York City. The New Yorker Magazine was able to get in to interview me, only by going to Washington. When I was thrown in the hole, it was a letter from Congress asking who ordered that treatment which resulted in my instant release. And as for my release from contempt, that only took place when the Supreme Court ordered the government to respond to my petition, for then the Solicitor General is the only one who can argue before the Supreme Court, not the corrupt prosecutors from New York City. So it is never just a single entity we call government. There are always internal forces that fight over the crumbs of power like pigeons on the ground under the tables at a sidewalk cafe.
I have advised many governments in my life, so there are those on the economic side of power who are well aware of what I stand for, not merely the prosecutors who salivate over the opportunity to take down someone famous to further their personal careers. I was perhaps the first and only analyst or Forecaster invited by the Bank of China to fly to Beijing during the Asian Currency Crisis back in 1997. I may even be the only analyst who has ever had such an experience on a truly global scale. I have been just about everywhere, and at times it appeared that if there were crisis, somehow I was dragged into it by some government somewhere. There is scarcely a major nation who is not aware of the ECM.
Continue reading at http://armstrongeconomics.com/archives/30145
Stocks too high, Yellen says, well that’ll larn’em, dropped today, will they continue down? How bad are P/E ratios at this time? Or don’t P/Es count any more?
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