201502.27
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Chicago Really, Really Didn’t Cooperate

The last time I commented on the Chicago Business Barometer (formerly the Chicago PMI) it was over a one-month drop that was quickly erased. That violated a personal rule whereby I make every effort to ignore sentiment surveys as they both do not mean what they are taken for and are usually of dubious value….

201502.27
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Harmonized Inflation

France was the latest Eurozone country to announce officially an entrance into negative “inflation.” The French were very cautious, overly it might be said, to assure that such an outcome was not at risk of pushing that economy into “deflation.” Apparently, rigidity in wages from socialism is a factor as an economic buffer, though left…

201502.27
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GDP Is Speculative

I think the ongoing destruction in the Japanese Household sector demonstrates very well a specific shortcoming about economic statistics like GDP. The basic calculation of the particular measure that forms the headlines of almost all commentary is a comparison of the current quarter to the previous one. That right away opens the door to incongruities…

201502.27
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Still No Gain

Despite all evidence to the contrary, an imbalanced ledger of data that grows more imbalanced by the month, commentary continues to describe QE as pro-growth stimulus. As usual, the purest form of rebuke to that sentiment can be found in Japan where QQE has performed a global service just not in the way its theorists…

201502.26
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CPI Really Didn’t Cooperate

Say what you want about the CPI as it relates to inflation, the actual calculation is set up to measure essentially what GDP measures. That is why economists take their calculations of “inflation” as almost literal substitutes for actual economic activity. There is little denying the close correlation between economic activity especially in recession and…

201502.26
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Durable Goods Won’t Cooperate Either

Yesterday in trying describe Janet Yellen’s testimony to Congress about the economy, pundits apparently were forced to concede that the “data won’t cooperate”, thus leaving the economy in Yellen’s head to be wholly different than anything described elsewhere outside the media echoes. Today’s release of durable goods provides yet another data point that “will not…

201502.26
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New Home Sales Confirm Resales; New Home Prices Confirm Bubble

The pace of new home sales continues to be stuck right below that 500k SAAR, a flattening of activity that dates back really to January 2013. The data has at times peaked above 500k only to be revised subsequently lower, which does not provide a whole lot of confidence about recent months. January’s level was…

201502.25
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Yellen Can’t Get Cooperation

Janet Yellen’s testimony concluded, no one gets any more clarity about what the FOMC actually thinks. However, that itself is in one sense an indication as she vacillated a little too much about making a firm commitment to either the recovery or “transitory” oil prices. QE3 ended months ago and we are seven years into…

201502.25
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Regulations Are Bad Enough, But QE May Have Been So Much Worse

Along with the new Basel-y rules to be adopted for the banking system, there are other major changes that have remapped at least domestic finance since 2007. A big part of this pertains to the systemic liquidity capacity that I emphasize repeatedly, but in the sense that it is far more and different than just…

201502.25
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New Bank Rules Will Accomplish The Same As The Old Bank Rules

There has been an exodus of sorts of mathematical expertise out of ratings agencies and into the biggest banks themselves. That may not sound like much of a change, after all it was Wall Street that hired the most Ivy League mathematicians during the last bubbles of the 1990’s and 2000’s, but the talent being…