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collateral

Is It Over?

By |2018-05-01T17:10:13-04:00May 1st, 2018|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets, Stocks|

The world is full of anomalies. It may seem like a paradox, but financial markets are particularly eventful places. Something happens, some people notice, and most often it goes…nowhere. It’s all the time and a constant part of analysis, trying to identify and separate what is truly contained. The global eurodollar monetary system grew so far and so fast in [...]

COT Blue: A Decade of Weird

By |2018-03-16T16:17:47-04:00March 16th, 2018|Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

On July 15, 2008, Federal Reserve Chairman Ben Bernanke sat in front of Congress for the second of his required Humphrey-Hawkins reports for that year. The original act meant for these to be more than bland economic obfuscation, where the original Full Employment and Balanced Growth Act of 1978 demanded monetary targets. The Fed stopped being able to produce them [...]

Thinking Liquidation

By |2018-02-08T17:44:59-05:00February 8th, 2018|Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

It’s impossible to tell what drives the short run in anything, so anything we describe and attempt to ascribe moves to comes with a grain of salt. That said, there are clearly some things missing here. I’m not talking about big stuff like overrating the Fed’s predictive abilities and its resolve, ridiculous stock valuations, or anything of the like. Stocks [...]

Confirming the Big Change In 2017

By |2018-01-16T17:43:06-05:00January 16th, 2018|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

What determines the price of gold? It seems like it should be an easy question to answer, but gold more than perhaps any other asset often mystifies in its behavior. Part of the reason is mainstream, orthodox Economics and its practitioners who have waged an intentional war on the metal for more than a century and a half. Demonizing it [...]

Rising ‘Dollar’ Re-Rises? Part 2, The Fruits of Our Obsession

By |2017-12-27T18:35:20-05:00December 27th, 2017|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

I suppose it’s easy to look at gold and see only fear. It is, after all, the ultimate currency hedge. Therefore, if the price is rising there is probably a good chance fear over monetary considerations is, too. The opposite interpretation, then, would appear to be just as straightforward, but it’s often complicated by the mechanics of wholesale global eurodollar [...]

Rising ‘Dollar’ Re-Rises? Part 1, Mexico Ain’t Suffering NAFTA

By |2017-12-27T16:33:55-05:00December 27th, 2017|Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

One of Candidate Trump’s biggest priorities was to renegotiate NAFTA. Seen as an accelerator for harm not just inside of the nation’s rust belt, the incoming administration made it a top priority. Blaming the trade deal for the loss of 700k manufacturing jobs, Robert Lighthizer, the US’s top trade official for the renegotiation process, said in August as talks got [...]

TIC Points To ‘Dollar’ Redistribution As Much As Possible Supply

By |2017-12-18T12:59:25-05:00December 18th, 2017|Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

We ended last week with a clear sign that global “dollars” are in (escalating) shortage. I would write “again” with that sentence but there is every indication that said shortage never really ended. It’s not like last year’s “reflation” was a switch from insufficient supply to sufficient, rather it was a relative change to a degree that isn’t easily established [...]

Chart of the Week: …ummmm

By |2017-12-15T12:53:42-05:00December 15th, 2017|Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

Back in early October, I noted that repo fails had jumped above $250 billion (combined “to receive” and “to deliver”) for three weeks straight. That wasn’t an auspicious result, as sustained collateral problems like that don’t correlate to happy things. It all began the week of September 5, in what seemed like a minor one-day nuisance over the 4-week bill [...]

Bonds vs. Economists; The Means to the End

By |2017-12-11T16:52:31-05:00December 11th, 2017|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

As part of its effort to stress its own self-importance, the Federal Reserve conducts a survey of the Primary Dealer members through its New York branch. A written questionnaire is sent out to each bank in advance of every monetary policy meeting. The purpose is for monetary policymakers to make sure that there aren’t any big surprises, that the market, [...]

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