Low Rates, Dollar Strength, SWIFT… Q&A with Lynette Zang and Eric Griffin

ITM Trading, Released on 11/5/19

Slides and Links: https://www.itmtrading.com/blog/low-r…

Question 1. Tom K: We know when bond yields go down principal goes up, and vice versa. When FED and ECB cut rates why doesn’t the currency get stronger?

Question 2. Vinnie R: can you explain what shadow banking is?

Question 3. Mike C: What are your views on India, China and Russia developing an alternative money transfer system to the SWIFT system? Apparently, this is gaining momentum in response to accelerating US money printing.

Question 4. Brad R: When Jerome Powell from the fed stated that they will be “adding to their reserves,” what exactly does that mean? Does this mean printing more reserve notes, buying more bonds, adding to their own gold reserves, or all of the above? I am asking this because I was under the Impression that the Federal reserve is not federal and has no reserves.

Question 5. Mitch G: Since all the world is in a low interest rate environment, could it be argued that low rates is “normal.” If the central banks are able to keep confidence by convincing everyone that this is the new normal could they prolong indefinitely a collapse?

Lynette Zang has held the position of Chief Market Analyst at ITM Trading since 2002. Ms. Zang has been in the markets on some level since 1964. Her mission is to convert financial noise into understandable language. She has been a banker, a stock broker and studied world currencies since 1987. She believes strongly that we need to be as independent as possible and at the same time, we need to come together in community in order to survive and thrive through the hyperinflation she sees in the near future.

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