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central banks

Third Time’s A Charm?

By |2018-01-18T17:30:11-05:00January 18th, 2018|Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

I find the article laughable. I should point out I am a millennial male though, so I would think that. We invest in bitcoin because we are BROKE, and you cannot earn any significant amount by working. And honestly, this entire market proves what we all suspected. Working is for suckers, it will not get you ahead, and money makes [...]

The Mother Of All Bait’n Switches

By |2017-06-29T12:41:52-04:00June 29th, 2017|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets, Stocks|

In light of light inflation measurements, central bankers have no other choice but to step up their rhetoric. Mario Draghi took the mantle earlier this week and has been joined at various points by others. The message they are sending is one that is purposefully muddied. There isn’t left to them any other choice. There are only two pillars holding [...]

Unfortunately An ‘Official’ End To The Rising Dollar Isn’t More

By |2017-05-17T19:15:03-04:00May 17th, 2017|Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

TIC data confirms that “reflation” captured more than just pricing sentiment. It appears to have occurred in bank balance sheet activity, and related official sector UST transactions. As to the latter, official holdings of US$ assets did decline on net in March 2017, the latest figures, including more selling of UST’s. The scale of the decline was less than we [...]

TIC Analysis of Selling

By |2017-03-24T16:38:30-04:00March 24th, 2017|Economy, Federal Reserve/Monetary Policy, Markets|

When the Treasury Department released its Treasury International Capital (TIC) data for December, what was a somewhat obscure report suddenly found mainstream attention. Private foreign investors had sold tens of billions in US securities primarily US Treasury bonds and notes which the media then made into some kind of warning to then-incoming President Trump. It was supposed to be a [...]

Of Banks, Europe, Euros, and Eurodollars

By |2017-02-22T16:18:10-05:00February 22nd, 2017|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

Rather than bury this chart in my earlier discussion of liquidity preferences, I felt it deserved its own piece to highlight what it shows. By all traditional and orthodox Economics, this just should not be possible. Yet, there it is and it’s not the only example of violation. For very different markets as robust as each one is, there should [...]

Their Gap Is Closed, Ours Still Needs To Be

By |2017-02-17T16:19:43-05:00February 17th, 2017|Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

There are actually two parts to examining the orthodox treatment of the output gap. The first is the review, looking backward to trace how we got to this state. The second is looking forward trying to figure what it means to be here. One final rearward assessment is required so as to frame how we view what comes next. As [...]

Changes In TIC

By |2017-02-16T17:31:25-05:00February 16th, 2017|Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

If there has been a lot different about the past few months, it was reflected in the TIC figures and then some. What is usually pretty easy to decipher, there were instead all sorts of shifts across the most important categories. For one, the foreign official sector was busy in December buying up UST’s and dollar assets just as the [...]

How To Properly Measure The Economy So As To Properly Interpret ‘Hawkishness’

By |2017-02-15T12:18:21-05:00February 15th, 2017|Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

Janet Yellen was apparently “hawkish” again in her latest speech, though the reasons why she may have been continue to elude the media and many markets. In many ways, she doesn’t even know, a fact that she expressed several months ago to likewise very little appreciation. The FOMC may or may not raise rates in the next meeting or the [...]

Eurodollar Decay, Specifically What’s Missing

By |2017-02-14T17:34:49-05:00February 14th, 2017|Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

Economists have always fashioned themselves in the style of physicists. They endlessly scrawl incomprehensible equations on blackboards because it is the epitome of science, the allure of great intelligence seemingly to do great things. But where physicists have continued to describe and solve some of the world’s great mysteries, Economists only bungle. They described free trade from among the myriad [...]

Eurodollar Decay, What’s Missing?

By |2017-02-14T16:19:47-05:00February 14th, 2017|Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

Earlier this week Bloomberg published an absurd story trying to claim that Donald Trump is being warned by foreign holders of US debt. Warned about what, the article didn’t say, so we can reasonably speculate (unlike the article) it was about politics. Bloomberg never did seem to report any such spreading alarm throughout the last Obama years even though selling [...]

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