Far be it for me to defend Mario Draghi, but earlier this month when it was revealed that Eurozone inflation burst above the 2% target level for the first time in four years the mainstream characterized his demeanor as being more than what it really was. That says something about the media as well as Draghi, where the former is [...]
Why did Mario Draghi appeal to NIRP in June 2014? After all, expectations at the time were for a strengthening recovery not just in Europe but all over the world. There were some concerns lingering over currency “irregularities” in 2013 but primarily related to EM’s and not the EU which had emerged from re-recession. The consensus at that time was [...]
Germany is notoriously fickle when it comes to money, speaking as much of discipline in economy or industry as central banking. If ever there is disagreement about monetary arrangements, surely the Germans are behind it. Since ECB policy only ever attains the one direction, so-called accommodation, there never seems to be harmony. But that may only be true because “accommodation” [...]
While the media remains fixed on supply, the rest of the financial complex is prepared elsewhere. On Monday, Saudi Arabia announced what the mainstream has been waiting for (and often blatantly demanding) since the summer “rebound” faded into August liquidations. Given the mythical status of Saudi supply, this was the one country thought to be the only possible savior. Crude [...]
It is becoming settled wisdom that the most dangerous aspects of any current financial contours are due almost entirely to some version of HFT or electronic trading. That is undoubtedly true, as far as it might relate to one aspect, but to claim that computers are the single biggest source, let along only source, of financial impropriety is obtuse. The [...]
For most commentary on the recent and sharp decline in oil prices, there is a serious ceteris paribus to it especially from those that don’t recognize that there are much deeper financial forces. The following is excerpted as an example of the closed system approach, as if there is a world of difference that can allow “decoupling.” What matters is [...]
Though they still refer to “supply” in almost every written piece about the recent oil price action, it is now more of a background note. Instead, the narrative is being forced by reality to adjust. Finally recognizing the role of demand in oil prices, the excuse morphs into “it’s only temporary.” Global oil markets are experiencing “temporary” instability caused mainly [...]
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 other factors intertwine and take [...]
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