It’s Not All Oil and Gas

In addition to this morning’s “noisy” and suddenly more tame CPI report, there is a broad-based decline in commodity prices that is more than a little bit outside of “usual” volatility. It should be noted at the start that commodity prices are not always direct reflections of economic activity or expectations for future activity, as .. read more


Stocks managed to finish the week on a positive note after a volatile ride that seemed to be based mostly on the changing geopolitical situation. Stocks fell with the imposition of retaliatory sanctions from Russia and rose as Putin seemed to back off at the end of the week. Thrown into the mix was an .. read more

The China Shuffle

Chinese financial behavior more recently has been far more favorable than the first part of the year. While there still remains this idea of PBOC control, I think, again, that the second quarter fully bears out the lack of control and the fear that engendered. Very quietly, the PBOC in June rolled out something called .. read more

Speculating On The Gold Supply

What follows here, in the interest of full disclosure, is nothing more than speculative conjecture on my part. This is due mostly to the opacity that dominates gold “markets” and trading oddities that follow from it. My thoughts here are based on gut instinct about recent observations, but that is about as much to solidify .. read more

It’s A Big World Out There

Home country bias is the tendency for investors to focus more on their domestic economy and markets. For most of the people reading this the US markets are home and with the Dow breaking 17,000 this past week the US is certainly getting a lot of attention. And it deserves it I guess considering the .. read more

Yellen Looks the Other Way

More of the same from Janet Yellen in her latest speech, but her focus on “resilience” caught my attention as it relates to very recent developments. The taper threat experience last year may have been a warning, but it doesn’t seem like it resonated with her or policymakers. The major bond selloff, which led to .. read more

The Golden Tail?

The positive price action in gold of the last few weeks stands out in sharp contrast to other sectors of the funding market, particularly repo. Under last year’s defiling paradigm, such a collateral shortage as pronounced as what we see now would have been disastrous for gold prices (more collateral demand typically leads to an .. read more

An Incomplete Picture: Reverse Repos, T-bills and Gold

The explanation given for the increase in participation at the reverse repo “window” in mid-April was taxes. In other words, the payment of quarterly and annual estimates and billings reduced the need for the federal government to borrow. Since the variability in borrowing amounts is taken up in t-bills, the relative scarcity of on-the-run t-bills .. read more