On January 24, Treasury Secretary Steve Mnuchin either misspoke or let slip a Freudian sort of wish. Extolling a weak rather than strong dollar, it was seemingly a total break from longstanding official US policy. It’s not really a policy anyone takes too seriously, if for no other reason than the dollar isn’t really a part of the Treasury. Still, [...]
How much growth is enough? It’s a pretty simple question that upon close examination leaves no easy answers. This is a problem that has plagued economists since there were economists. Recognizing very real dangers on both sides, there is as much trouble about “too much” as “too little.” The purpose of the modern central bank, then, is to moderate and [...]
At the end of last month, the Brookings Institute hosted a conversation where one of their most distinguished current scholars introduced and interviewed one of their newest. The former was former Federal Reserve Chairman Ben Bernanke welcoming the latter, former Federal Reserve Chairman Janet Yellen. Listening to them talk was a total delight (thanks T. Tatteo for that), particularly for [...]
Tomorrow, it is widely expected that the FOMC will vote for another 25 bps “rate hike.” The long end of the UST curve is already just as unenthused as ever, while the short end expects higher yields on money substitutes. The result is the very familiar collapse in the yield curve, one that like both of the prior “rate hike” [...]
The background for inflation hysteria was pretty simple. Globally synchronized growth meant acceleration in the US economy which would raise demand for labor. The unemployment rate, faulty as it has been, suggests that any further increase in labor utilization would just have to pressure wages – the competition for workers rises as the marginal supply of them dwindles further downward [...]
Friday, January 26, stocks hit their last record highs. Buoyed by supposedly strong earnings along with near euphoria about tax reform anecdotes, all three major US indices were sitting at their respective tops after another big week. Everything was apparently going in the right direction: All the three key U.S. indexes closed at record levels on Friday following better-than-expected earnings [...]
Top Chinese leadership is taking further shape. With Xi Jinping’s continuing consolidation of power going on right this minute, most of the changes aren’t really changes, at least not internally. To the West, and to the mainstream, what the Chinese are doing seems odd, if not more than a little off. Unlike in the West, however, there is determined purpose [...]
In February 2018, it was like old times for the US industrial sectors. Prior to the 2015-16 downturn, the otherwise moribund economy did produce two genuine booms. The first in the auto sector, the other in energy. Without them, who knows what the no-recovery recovery would have looked like. They were for the longest time the only bright spots. The [...]
On July 15, 2008, Federal Reserve Chairman Ben Bernanke sat in front of Congress for the second of his required Humphrey-Hawkins reports for that year. The original act meant for these to be more than bland economic obfuscation, where the original Full Employment and Balanced Growth Act of 1978 demanded monetary targets. The Fed stopped being able to produce them [...]
Is there a seasonal pattern to oil prices? It is beginning to look that way, though statistical purests would object to a sample size of two. Over the past couple of years, the switch between “reflation” and anti-“reflation” has taken on a little too much familiarity in terms of time and timing. In the summer months between June and November [...]
Stay In Touch