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global slowdown

Canada’s Fallacy Contribution

By |2019-01-23T18:19:03-05:00January 23rd, 2019|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

If there is one small silver lining from 2018’s economic performance, it is that Milton Friedman’s interest rate fallacy is being robustly proven yet again. Many Economists will have you believe that low interest rates, short or long, are stimulus. This is a huge mistake. Here’s what Friedman said in December 1997: As the economy revives, however, interest rates would [...]

Chinese Trade Revisits

By |2016-12-08T18:13:31-05:00December 8th, 2016|Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

China’s trade statistics were improved in November, further fueling the global “reflation” dreams. Imports rose 6.7% year-over-year, the second increase in the past four months (August) and the best since September 2014. Exports were nearly flat, up the tiniest fraction, 0.1%. That was the second time this year exports were positive. Again, these numbers have been very well received: “The [...]

And, Predictably, Another Two Steps Back

By |2016-10-13T17:10:03-04:00October 13th, 2016|Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

If you are not an economist bound by dogma, or a member of the media forbidden from using opinion of all but the finest (sounding) credentials, there is no mystery. I am as tired of writing about it as you are of reading it. The mainstream is by convention of the business cycle forced into linear extrapolations. Therefore, economic accounts [...]

The Official Face of the ‘Rising Dollar’, Written Officially As Farce

By |2016-07-26T18:13:22-04:00July 26th, 2016|Bonds, Commodities, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

Last July, the US Treasury Department finally issued its official report detailing its account of what happened on October 15, 2014. The statement was co-authored by staff at the Board of Governors of the Federal Reserve System, FRBNY, the SEC, and CFTC, as if the government were going overboard trying to prove its word the end of the matter. As [...]

The ‘Costs’ Of Beyond The Cycle

By |2016-07-13T18:01:57-04:00July 13th, 2016|Economy, Federal Reserve/Monetary Policy, Markets|

We have to acknowledge that economic statistics are imperfect even under the best conditions. But that doesn’t mean we shouldn’t try to measure comparative circumstances where conditions are less than ideal or conventional. In terms of a business cycle, we think of recession as negative GDP; to the point that conventional “wisdom” actually believes two consecutive quarters defines one. Not [...]

Predictably, China Trade Falls Back In Line

By |2016-07-13T11:20:48-04:00July 13th, 2016|Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

The inconsistency or unevenness of the economic data is a huge part of the problem. The world wants to move in nice, clean straight lines and nowhere is that more of an assumption than economics. There is some allowance for variation but that is always expected to be minimal. The past four years or so just haven’t seen much deference [...]

Direct Line of Funding Warnings Show Up In Corporate Credit, Particularly IG

By |2016-07-08T16:58:27-04:00July 8th, 2016|Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

One of the consequences of last year’s junk bond blowup was, unsurprisingly, a dramatic decline in high yield gross issuance. The numbers were pretty stark. According to SIFMA, high yield gross issuance in Q1 was 60% less than Q1 2015, following Q4 which was 47% below Q4 2014. As the market has come back since March, for all sorts of [...]

No Help To The Global Economy From US ‘Demand’

By |2016-07-06T12:37:13-04:00July 6th, 2016|Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

You’ll have to forgive the Chinese if they view “global turmoil” as something far more than an esoteric financial concept to be debated by irrelevant monetary committees. US imports from China fell 4.3% year-over-year in May 2016, the third consecutive contraction and seventh out of the last eight months. With February’s 16% gain more a calendar/holiday illusion, especially since it [...]

Factory Orders And More Small ‘d’

By |2016-07-05T16:07:17-04:00July 5th, 2016|Economy, Federal Reserve/Monetary Policy, Markets|

Factory orders declined slightly year-over-year in May 2016, the 18th contraction in the past nineteen months (the only positive was February and its 29th day). On a seasonally adjusted basis, factory orders fell 1% month-over-month to $455 billion. That was less than the $462 billion for March 2011 back when the end of QE2 was a topic for discussion, before [...]

Politics of the Monetary Noose

By |2016-06-27T12:05:06-04:00June 27th, 2016|Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

In June 2015, Pew Research Center conducted a poll of citizens in European countries in order to gauge public sentiment of the European integration project. They found what they thought was a rebound in favorability. The survey conducted in 2013 appeared then to have been the low point, with the 2014 update finding an uptick in support. By last year, [...]

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