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industrial profits

Wait A Sec, That’s Not Really An *RMB* Liquidity Pool…

By |2022-06-27T20:25:13-04:00June 27th, 2022|Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

Ben Bernanke once admitted how the job of the post-truth “central banker” is to try to convince the market to do your work for you. What he didn’t say was that this was the only prayer officials had for any success. Because if the market ever decided that talk wasn’t enough, only real money in hand would do, everyone’d be [...]

Follow China’s True Line

By |2022-05-31T19:31:57-04:00May 31st, 2022|Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

It’s a broken a record, the macro stylus stuck unable to move on, just skipping and repeating the same spot on the vinyl. Since Xi Jinping’s lockdowns broke it, as it’s said, when Xi is satisfied there’s zero COVID he’ll release the restrictions and that will fix everything. The economy will go right back to good, like flipping a switch.Where [...]

A Sour End To The 2010’s Doesn’t Have To Spoil The Entire 2020’s

By |2019-12-31T16:34:26-05:00December 31st, 2019|Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

It has been perhaps the most astonishing divergence in the first two decades of 21st century history. In late 2017, Western economic officials (mostly central bankers) were taking their victory laps. They took great pains to tell the world it was due to their profound wisdom, deep courage, and, most of all, determined patience, that they had been able to [...]

Nothing Good From A Chinese Industrial Recession

By |2019-11-27T11:56:31-05:00November 27th, 2019|Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

October 2017 continues to show up as the most crucial month across a wide range of global economic data. In the mainstream telling, it should have been a very good thing, a hugely positive inflection. That was the time of true inflation hysteria around the globe, though it was always presented as a rationally-determined base case rather than the unsupported [...]

China Throws More ‘Stimulus’ At The Wall

By |2019-08-27T12:31:19-04:00August 27th, 2019|Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

Earlier this year, Chinese authorities reduced the VAT tax the government charges auto manufacturers. Intended to boost consumption, the levy was reduced from 16% to 13% in the hope automakers would pass along the savings to consumers. Many if not most manufacturers did. The results were immediate, and fleeting. In the month of March 2019, total car sales fell “only” [...]

China’s Big Risk(s): Running Out of Room To Tackle

By |2019-07-29T12:48:50-04:00July 29th, 2019|Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

The Chinese simply did what every Economics textbook currently in print says you are supposed to do. When confronted with a downturn, no matter its size you borrow your way through it. In fact, it says the greater the contraction the more you need to lean on finance. The neo-Keynesian model is unyielding on the matter. Using debt to boost [...]

China (Partly) Answers For Why Markets Are Forecasting Even More Powell Rate Cuts

By |2019-03-27T17:55:21-04:00March 27th, 2019|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

On February 7, the 3-month LIBOR rate (US$) fell sharply. Traders were, as various media outlets reported, stunned. All sorts of excuses were issued, the goal of them cumulatively to deny your lying eyes. Falling LIBOR couldn’t have been the market, especially eurodollar futures, anticipating a rate cut because these same people had been saying (and betting) for nearly two [...]

Fear Or Reflation Gold?

By |2019-02-01T17:07:59-05:00February 1st, 2019|Bonds, Commodities, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

Gold is on fire, but why is it on fire? When the precious metals’ price falls, Stage 2, we have a pretty good idea what that means (collateral). But when it goes the other way, reflation or fear of deflation? Stage 1 or Stage 3? If it is Stage 1 reflation based on something like the Fed’s turnaround, then we [...]

Unmixed Signals

By |2018-12-27T17:31:43-05:00December 27th, 2018|Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

In mid-December, the Bank for International Settlements (BIS) published its regularly quarterly update. It was just in time for the current bout of “overseas turmoil” which included a lot that wasn’t overseas. The BIS noticed, I’m sure reluctantly. Financial markets swung widely, eventually netting a sharp correction, during the period under review, which started in mid-September. Asset prices fell across [...]

China’s Global Slump Draws Closer

By |2018-12-03T11:56:38-05:00December 3rd, 2018|Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

By the time things got really bad, China’s economy had already been slowing for a long time. The currency spun out of control in August 2015, and then by November the Chinese central bank was in desperation mode. The PBOC had begun to peg SHIBOR because despite so much monetary “stimulus” in rate cuts and a lower RRR banks were [...]

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