201712.05
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COT Blue: Bonds Are Not Tuned In To The Mainstream Channel

You do have to wonder to whom the increasingly shrill bond market declarations are being directed. It’s very likely that Bloomberg’s now daily haranguing “the yield curve can’t possibly be right” tirades aren’t meant for UST investors. Rather, it is perfectly evident that the treasury market is going to do what it does regardless, and…

201712.05
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Bi-Weekly Economic Review: Who You Gonna Believe?

We’ve had a pretty good run of data recently and with the tax bill passing the Senate one would expect to see markets react positively, to reflect renewed optimism about economic growth. We have improving economic data on pretty much a global basis. It isn’t a boom by any stretch of the imagination but there…

201709.21
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The Eurodollar Equation Begins With The Imagination Variable

There wasn’t a whole lot that made sense about iron ore’s price surge through August. In the flipside of what is believed also to be moving copper, Chinese authorities have made it plain that they will take pollution control seriously this winter. For copper, that likely means shutting down mine production, tightening supplies, and could…

201708.18
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1

Global Asset Allocation Update: No Upside To Credit

There is no change to the risk budget this month. For the moderate risk investor, the allocation between risk assets and bonds is unchanged at 50/50. There are other changes to the portfolio though so please read on. As I write this the stock market is in the process of taking a dive (well if…

201708.14
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Bi-Weekly Economic Review: Ignore The Idiot

Of the economic releases of the past two weeks the one that got the most attention was the employment report. That report is seen by many market analysts as one of the most important and of course the Fed puts a lot of emphasis on it so the press spends an inordinate amount of time…

201708.04
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Questions

Why do the teachers unions oppose school choice? School choice and vouchers should be a positive change for teachers. They would have more choices of where to work and how to teach. They’d have more opportunities to experiment with different teaching methods. They could explore different compensation methods, potentially making more than they do now. Are…

201707.25
7
2

Copper And The Upside

Copper prices are up very sharply today, igniting across markets a reborn “reflation.” Treasuries along with eurodollar futures have been stuck in anti-“reflation” for quite some time. Copper, on the other hand, is not just now breaking from the pack. Going back to May 9, this important economic indication has been so far steadily bucking…

201707.17
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Global Asset Allocation Update: Not Yet

There is no change to the risk budget this month. For the moderate risk investor, the allocation between risk assets and bonds is unchanged at 50/50. There are no changes to the portfolio this month. Growth and inflation expectations rose somewhat since last month’s update. The change is minor though and within the range of…

201706.06
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Bi-Weekly Economic Review: The Return of Economic Ennui

The economic reports released since the last of these updates was generally not all that bad but the reports considered more important were disappointing. And it should be noted that economic reports lately have generally been worse than expected which, if you believe the market to be fairly efficient, is what really matters. The disappointing…

201705.10
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4

China Inflation Now, Too

We can add China to the list of locations where the near euphoria about inflation rates is rapidly falling apart. This is an important blow, as the Chinese economy has been counted on to lead the world out of this slump if through nothing other than its own sheer recklessness. “Stimulus” was all the rage…