How Markets Are Supposed To Work
In a regime where math acts as money, there are a few major potential chokepoints where shifts in math can become systemically important difficulties. In 2008, the most visible example was in repo haircuts, but [...]
The Income of ‘Full’ Employment
In some contrast to spending or even “demand”, the economic problem is and has always been the lack of income growth. The difference in economy between income and spending is debt. As noted earlier, it [...]
Revisions Don’t Change The Great Dislocation
The final revision to Q1 GDP changed very little, at least in its natural format given that there are benchmark revisions coming in less than a month that could significantly alter all of this. Even [...]
The Warning Embedded Within The Interest Rate Fallacy
On November 4, 2010, then-Federal Reserve Chairman Ben Bernanke wrote his infamous oped for the Washington Post “welcoming” the world to a second round of quantitative easing. The very fact that there was a second [...]
GDP Corporate Profits And Cash Flows Rebound in Q1, But Not Really
Accompanying the final estimate for Q1 GDP is the first estimate for the corporate profits and cash flow components. Profits rebounded from a dismal Q4, but that actually means much less than it sounds especially [...]
Money Market Illiquidity Further Removes A Central Myth
It might be expected that monetary policy would fail to achieve its goal in attempting to manage the economy when it cannot even meet its own basic technical requirements. The main lever of Fed policy [...]
Sector Snapshot: Defensive Sectors Take The Lead
Even before the Brexit vote, momentum was shifting to defensive sectors. The rally in weak dollar sectors - other than the gold/silver mining industry - was looking very overbought and tired anyway, so Brexit was [...]
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