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CNY 7: The Gears Behind the Clockface

By |2019-08-05T18:14:00-04:00August 5th, 2019|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

Right on cue, the Chinese have restarted “devaluation.” Because no one ever learns, and because trade wars are a conveniently timed distraction, CNY’s dramatic plunge below 7.00 is being written up as currency manipulation. It is manipulation, just nothing like what’s being described. PBOC Governor Yi Gang is a passenger here, not the man pulling the levers behind the scenes. [...]

Repo On The African Plain

By |2016-11-22T17:48:37-05:00November 22nd, 2016|Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

That the repo market, as noted yesterday, has been beset by a persistent collateral shortage is relatively uncontroversial. Where once large blocks of MBS tranches were central to interbank flow and funding, their absence is still a fact of operation though that repudiation was a very long time ago. Even with that backdrop, however, it doesn’t explain a whole lot [...]

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