They were never very specific to begin with, even in Ben Bernanke’s infamous November 2010 Post op-ed covering the start of QE2. Officials like to keep it purposefully vague as a kind of dry powder, a margin for error. If bureaucrats become too specific, the public would reasonably hold them to their own standard being laid out. The point behind [...]
The UK government tried very hard to hold on. They had been able to raise $200 million from JP Morgan, a significant sum at that time under those circumstances. The British had also secured an almost equal amount from banks in France. The new National Government had produced a budget slashing spending by £70 million, while also raising taxes by [...]
Since the corporate bond bubble has added more than a half year since I last updated its size potential, it is worth reviewing given the lack of enthusiasm in that space post-August 24. Even before that “dollar” run clocked China and the rest of the world, the corporate bubble was being dented by the larger “dollar” trend dating back to [...]
In April 2008, Nassim Taleb was becoming a household name criticizing the quant dominance in finance. Bear Stearns had just failed and the entire edifice of mathematical order was still breaking down, as the last bastions of credit default swap “supply”, the monoline insurers, were still rumored to be heading for insolvency (while the nightly news focused on whether that [...]
There can be no mistaking that Chinese stocks are in a bubble. Since November 21, the Shanghai SSE Composite index has risen more than 100%. Going back to July 22, the gain is nearly 145%. Those dates are not random coincidence, as they mark specific points of PBOC activity. The stock bubble in China is certainly a monetary affair, but [...]
There was a reason FDR’s administration in its first 100 days took the order it did. Contrary to some assertions, Executive Order 6102 was not a lawless expansion of executive privilege and prerogative. It had a very lawful basis, underwritten by the Emergency Banking Act of 1933 which itself was based on (and no part of this fact should be [...]
In its 84th Annual Report released last June, the Bank for International Settlements departed from usual central bankish conventions and decried the growing departure from market discipline and even reality. The BIS even used the loaded term “euphoric” to describe what it saw as risk market prices no longer affected by fundamental economic conditions. As the Financial Times noted then, [...]
With the US economy showing decent growth while the rest of the world is showing slow or no growth, currency traders are selling Euros and buying Dollars. As a result, the Euro is trading at intermediate term lows while the Dollar is hitting new highs. In recent months, equities and the dollar have gone from a nearly perfect inverse correlation to having practically [...]
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