Related to the FED increasing its balance sheet read Frances Coppola's "Banks Don't Lend Out Reserves" and pay attention to Lee Adler's comments as they add to the understanding rather then obfuscate and deflect as with most of the discourse on the web.
Interesting viewing and comments by analysts on what is in store for 2014. Opinions are free so take all with a pinch of salt and make sure you can sleep at night once you have determined your portfolio's allocation. As readers of this blog will know, my personal view is that policy rates are far from normalizing: market rates will ebb and flow with incoming data and political machinations in Washington, London, Berlin and Beijing but the deficiency in effective demand remains overly reliant on access to credit to bring consumption forward. Eventually, the survival constraint of debt servicing becomes of paramount importance so a hallowing middle class and growing precariat does not auger well for robust growth in the coming decades.
