inflation hysteria

What’s On Peoples’ Minds? Not Inflation

By |2018-08-29T15:54:49+00:00August 29th, 2018|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

There are a few pretty good indications that inflation hysteria is long dead. Since this was one of the more extreme forms, it’s also relevant in parsing any shift from reflation back to deflation. There are any number of markets suggesting as much already. Still, this one really has to sting for sunny, confident Jerome [...]

Why Hysteria Died, In One Day

By |2018-08-01T16:02:53+00:00August 1st, 2018|Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

Why did inflation hysteria die? The answer is surprisingly simple. Proponents way oversold the thing. They kept claiming that the labor market, via a truly booming economy, would force the Fed’s hand. Wage growth was about to explode, therefore monetary policy couldn’t afford to be complacent. Aggressiveness was about to become Jay Powell’s go-to position. [...]

It’s Taking Too Long, The Boom Didn’t Boom

By |2018-07-12T16:34:28+00:00July 12th, 2018|Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

At some point, the boom had to have boomed. We are moving into the past tense for all this now, inflation hysteria almost certainly tucked away into the economic ledger alongside four other false dawns. Data is coming in for June 2018, meaning half of this year already recorded and analyzed. It’s not what it [...]

Ptolemy Strikes Again

By |2018-05-31T11:23:45+00:00May 31st, 2018|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

Perhaps it is revenge for 2015’s residual seasonality breakout. Or maybe it is just being celebrated as delicious irony. Did the BEA just take revenge on the Fed? In early 2015, first the Philadelphia branch of the Federal Reserve and then its San Francisco arm both published essays essentially accusing the BEA of being unaware [...]

It’s Not The Minutes, It’s The Months and Years

By |2018-05-23T16:14:50+00:00May 23rd, 2018|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

It’s the kind of thing you’re supposed to overlook and not think too deeply about. Recall the basis of inflation hysteria: the economy was poised to take off and do so convincingly; that plus the ubiquitous LABOR SHORTAGE!!! meant that wages then inflation were going to break out higher; accelerating consumer prices were then to [...]

What Really Happened In Europe

By |2018-05-07T19:03:02+00:00May 7th, 2018|Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

The primary example of globally synchronized growth has been Europe. Nowhere has more hope been attached to shifting fortunes. The Continent, buoyed by the persistence of central bankers like Mario Draghi, has not just accelerated it is actually booming. Or so they say. Last September, politicians were lining up to confidently declare as much, often [...]

Someone Is On Drugs, Alright

By |2018-05-03T18:10:34+00:00May 3rd, 2018|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

For the second straight quarter, the Bureau of Labor Statistics (BLS) estimates US productivity growth was less than 1%. That’s not surprising given the weakening in output as measured by GDP, the data reported by the Bureau of Economic Analysis (BEA). Productivity is the bridge between the BLS’s labor numbers and the more general economic [...]

Inflation Hysteria Takes A Chinese Hit

By |2018-04-11T15:39:44+00:00April 11th, 2018|Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

Today is inflation day, as can happen on the occasional month. The US CPI came in without signs of acceleration despite the relinquishment of the Verizon effect on the statistical bucket. Financial markets are unenthused by all this, but you might not know why. The spread between 5- and 30-year Treasury yields, as well as [...]

The Boom Takes Another Big Hit

By |2018-04-10T18:49:21+00:00April 10th, 2018|Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

The Congressional Budget Act of 1974 requires the Congressional Budget Office (CBO) to produce and release its economic projections and assumptions every year. Typically, the CBO does so under initial assumptions each January. Those estimates are then revised, if necessary, later in the year with more complete information. This past January, however, the release was [...]