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Jakobsen: Why the markets are losing patience with the Fed
By how much will the US Federal Reserve reduce its bond buying programme? Steen Jakobsen says the markets are losing patience with a lack of clear direction. It's clear to him that we will see a tapering of 15 and 20 billion dollars of asset purchases. He also points out that the Fed's budget deficit is now equal to the size of its bond-buying programme, it will soon need to reduce it. It's a simple question of mathematics.
Specifically, he says investors are fed up with the interest rate market and everything that is interest rate related, which he says remains in a "vacuum where nothing works".
Steen also warns that the significance of tapering "is over-estimated" and in fact he thinks it is more likely that, if anything, we will get more QE not less, but it will come in different forms.
02:08 minutes
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