For about the last two weeks, I have been writing about the contours of what I have perceived as a RMB liquidity operation that seems to be far more than the usual management of day-to-day confluences. Since the last week in October, RMB liquidity both onshore and offshore has been more and more plentiful but only in the shortest overnight [...]
IBM continues to be a bellwether assessment on domestic and global capex, though in 2015 almost everyone wishes it wasn’t. To that end, many have started to downgrade Big Blue based on age in the business cycle and, of course, currency. In many ways, the latest quarterly stumble is the mirror image of when all this started. Plotting IBM’s transformation, [...]
For almost a year now, even before 2014’s version of winter, the constant theme has been one of growing and robust jobs. It had become so ubiquitous as to infiltrate every economic data point, including the housing market. There was some correlation last year between the sentiment about payroll expansion and at least a tepid rebound in home sales, but [...]
I have to hand it to the good work done by Gallup, as their tracking polls have “previewed” the “official” retail sales reports these past few months. Gallup found another Polar Vortex-like hole in consumer spending and sure enough the Census Bureau confirmed as much. It is decidedly ugly and can do nothing but put a major dent in the [...]
Even Harley Davidson is against the “strong dollar” at this point, which I think says a lot about how financialism has destroyed even this most basic sense of “money.” For the record, Harley’s profit was down “slightly” with the company of course blaming the “dollar.” The toothpaste business has also been seriously affected, afflicting Colgate where Latin America is a [...]
The idea of economic instability is not just academic conjecture, as there is a great deal of evidence to support this kind of fragility. And it is fragile in the sense as Nassim Taleb describes, namely that what looks to be stable and growing on the surface is “somehow” susceptible to the slightest provocation; such as cold winter. Again, that [...]
There is very little that needs to be said about the April estimates for Japanese wages. The prolonged agony was extended yet again despite the purported “surge” in the Japanese economy. What the latest figures show is exactly what I suspected when the spending data first came out – that the Japanese are so pessimistic about their wage situation they [...]
The last time Japan increased its sales tax rate in an effort to get its fiscal “stimulus” deficit under control was 1997. It was, in part, responsible for ZIRP and the perpetual QE that followed. These days Japan’s economy functions in a similar state of decrepitancy that has “forced” the Bank of Japan to reach further into the activist policy [...]
It isn’t exactly the Thai baht, but the dong was slightly devalued yesterday. Vietnam reduced its reference rate by about 1% (the reference rate is the midpoint in a currency corridor for the dong/dollar exchange value). Vietnam devalued by about 8.5% early in 2011, so it doesn’t seem to be much of a move in comparison. But the dong follows [...]
The contentious drop in gold prices is parallel to so many other assets at the moment that it cannot be anything but a liquidity event. At this point, the proximate cause is really academic; Bank of Japan, China, taper, etc. However, despite protestations, and vehement at that, that the euro crisis has been buried, the opposite is again becoming reality. [...]
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