In another case of government meeting reality, Saudi Arabia sacked its long-serving Finance Minister at the end of October. In a move reminiscent of the recent shakeup in Beijing’s Finance Ministry, with longstanding technocrat Lou Jiwei being ousted, Saudi Arabia has had to face up to more than just oil prices. Ibrahim al-Assaf had been in that position since 1996, [...]
A big reason why Chinese banks struggled yesterday in their daily bid for “dollars” (CNY DOWN) was the relatively unchanged economic statistics for November. Many in the media have tried to frame China’s economic situation in 2016 as if stabilizing were a positive outcome. Markets, especially funding markets, aren’t so enthused about the prospects for “weak but not getting weaker.” [...]
The rout in EM’s continued into this week, suggesting that the negative reactions last week may have been more than reflexive recoiling to whatever catalyst. The media is struggling to figure it out, and so has brought up the usual suspects even though there is great inconsistency in doing so. Expectations of fiscal stimulus, infrastructure spending and reflationary policies under [...]
These things evolve, and they take time. There are a great many similarities between what is going on now and what happened in 2007 and 2008 pertaining to money, then finance, finally economy. Starting August 2007, the eurodollar system fell apart in condensed fashion, almost a typical “run” if but one of and between only banks. Starting in August 2011, [...]
China’s State Administration of Foreign Exchange (SAFE) reported a large drop in forex assets in October. This was unsurprising given what we already know of “dollar” conditions from the behavior of the exchange rate itself. The pattern is by now very well established and quite predictable. At -$45.73 billion for the month, it was by far the largest decline in [...]
There are many facets to gold, which is as it should be. In trying to discern what ones are moving prices at any given moment, the complexities and really its duality can cloud the matter, often greatly. From the post-1971 traditional perspective, it is believed the preeminent inflation hedge. In financial terms, it is sensitive to shifts in relative interest [...]
There bond selloff intensified the past few days in the wake of the election. I still believe that the potential Trump represents, rather than anything that has been specifically proposed, is the likely catalyst. I am also quite certain that goes along with the change in Chinese behavior where RMB are far more plentiful now than just a few weeks [...]
In early November 2012, China’s National Bureau of Statistics reported that China’s exports were figured by the Customs Bureau to have been about $175.57 billion for October that year. It represented a year-over-year increase of 11.5% which only sounds good as compared to the economy that followed. The rate was down sharply from recovery-like growth that everyone had expected would [...]
For about the last two weeks, I have been writing about the contours of what I have perceived as a RMB liquidity operation that seems to be far more than the usual management of day-to-day confluences. Since the last week in October, RMB liquidity both onshore and offshore has been more and more plentiful but only in the shortest overnight [...]
A strong cohort of global PMI’s has cheered today pretty much everyone, from economists to the media and anyone else in between. China’s official Manufacturing PMI was calculated at 51.2 in October, the highest level since July 2014, up seemingly significantly from the 49.9 just three months ago this July. In the United States, the ISM Manufacturing rose again to [...]
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