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Economy

Yes, Sweden Is A Domino

By |2018-09-12T12:17:39-04:00September 12th, 2018|Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

Over the weekend, another European nation turned toward the populist direction. It was enough to get one’s attention when Italy did it, but Sweden is something else altogether. The country has been long held out as an exemplar of everything that is right with globalization. They have industry, youth, etc. How in the world could another “far right” party score [...]

Bond JOLTS Without Wages To Back Just JO

By |2018-09-11T17:46:59-04:00September 11th, 2018|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

In the absence of a booming economy, one has been conjured from a select few employment statistics. The catalog, beginning in 2014, consisted of a rapidly falling unemployment rate, the Establishment Survey which dazzled with headline payroll growth supposedly adding up to the “best jobs market in decades”, and the JOLTS series but curiously omitting everything but the Job Openings [...]

Prefiguring The Expected Expectations Fail

By |2018-09-10T18:24:12-04:00September 10th, 2018|Currencies, Economy, Federal Reserve/Monetary Policy, Markets, Stocks|

The Boston Fed held its 62nd Annual Economic Conference over the weekend. Not quite as well-known as the KC Fed’s Jackson Hole symposium, this Eastern branch’s meeting still attracts many big-name speakers. The “right” speakers, that is, meaning academic and mainstream bank Economists, supranational think tank thinkers, as well as current and former central bankers. The echo chamber is just [...]

A Long Dollar Story: China’s Short Profits, Prices, and Producers

By |2018-09-10T16:59:18-04:00September 10th, 2018|Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

For the first half of the Great “Recession”, China and the rest of the EM world seemed immune. It was American subprime mortgages that we were told was causing all the problems, and if European banks had somehow gotten themselves entangled in the rotten real estate mess so much the better for where growth was invulnerable. This first instance of [...]

Chart of the Week: Playing With Dominoes

By |2018-09-07T18:06:09-04:00September 7th, 2018|Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

The Great "Recession" was never a recession. It was a monetary event first and foremost, and it continues to be eleven years later. That means by and large it has been a failure of imagination. Central bankers say they've done this and that, but what they've never done, apart from actually succeed, is examine the way money actually works in [...]

Japan’s Not Really A Domino, Though The Timing Is Right

By |2018-09-07T17:41:19-04:00September 7th, 2018|Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

This year is just different. Increasingly so. Not just in one or two places, either, but in way too many places. In Japan, for instance, real Household Spending rose by the smallest amount in July, according to the latest estimates from Statistics Japan. In 2017, this would have been a worrisome sign. In 2018, it counts as one of the [...]

Canadian Domino

By |2018-09-07T16:29:00-04:00September 7th, 2018|Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

The ritual of Payroll Friday is not strictly a sorry American phenomenon. It is one shared by our neighbors to the north. The Canadian version, thanks to M. Simmons filling in the gaps of my limited experience with it, doesn’t typically sink into the depths of silliness to which its US cousin explores. At least not in as many months. [...]

The Payroll Ritual

By |2018-09-07T12:06:56-04:00September 7th, 2018|Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

Payroll Friday continues to be among the more absurd rituals of the finance industry. That’s saying something because in this business there are many that in any other context would be laughed out of the discipline. Never mind the impropriety of attempting to use a single monthly yardstick for economic progress, over the last four years the payroll report has [...]

It’s A Dollar-based Boom Shortage More Than Anything

By |2018-09-06T17:33:38-04:00September 6th, 2018|Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

Liquidity preferences are one of the least discussed economic concepts. There are several channels into which monetary instability can hamper the real economy. A “dollar” squeeze doesn’t just impact banks, they often pass it along further down the economic chain. In its most extreme form, we had something like 2009. Some of the best companies all over the world found [...]

One Fragile Year In Review: It Was A Warning

By |2018-09-05T17:46:54-04:00September 5th, 2018|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

One year ago today, something broke. It wasn't a big thing, practically a footnote seemingly not worth mainstream attention. Out of nowhere, the 4-week T-bill yield spiked. On Friday, September 1, 2017, the equivalent interest rate for the instrument was steady at 96 bps. That was already a problem because the Federal Reserve’s RRP was at the time set for [...]

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