pboc

Your Semi-Annual Golden Week Reminder

By |2018-09-25T11:56:06+00:00September 25th, 2018|Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

It’s that time of year. September, the leaves start to turn and the air grows crisp. Autumn smells arrive; the Chinese prepare for their nationalist Golden Week. Ever since 2014 and the dollar’s rise, that is, eurodollar tightening especially in Asia, these holiday bottlenecks are never boring. To be shut down for an entire week [...]

A Long Dollar Story: China’s Short Profits, Prices, and Producers

By |2018-09-10T16:59:18+00:00September 10th, 2018|Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

For the first half of the Great “Recession”, China and the rest of the EM world seemed immune. It was American subprime mortgages that we were told was causing all the problems, and if European banks had somehow gotten themselves entangled in the rotten real estate mess so much the better for where growth was [...]

When Central Banks DON’T Print

By |2018-08-17T11:41:30+00:00August 17th, 2018|Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

We all know, or we think we do, what happens when central banks print money. There are any number of historical images from which we can refresh our collective memory. Weimar Germany usually comes to mind, as does Venezuela or Zimbabwe in recent times. But what about the opposite? It sounds absurd. No government officials [...]

The Smoke Thickens In China

By |2018-08-13T11:54:23+00:00August 13th, 2018|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

A major part of any yield curve is inflation expectations. Nominal growth particularly toward the longer end of curves sets the agenda for trading. But further out there are several confluences that may cause distortions. For Economists, these are conundrums. There are times, however, when curve dynamics remain pretty simple. These are not usually the [...]

What Chinese Trade Shows Us About SHIBOR

By |2018-08-08T12:35:57+00:00August 8th, 2018|Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

Why is SHIBOR falling from an economic perspective? Simple again. China’s growth both on its own and as a reflection of actual global growth has stalled. And in a dynamic, non-linear world stalled equals trouble. Going all the way back to early 2017, there’s been no acceleration (and more than a little deceleration). The reflation [...]

Deflationary Decade(s)

By |2018-08-06T16:44:09+00:00August 6th, 2018|Commodities, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

I’ve seen a lot of commentary lately describe conditions as if things are calmed down. There was a bit of growth scare, a little T-bill indigestion earlier in the year. The Chinese are somehow both stimulating their export sector by devaluing CNY, and also controlling the price of gold while they do it. The contradictory [...]

What Was That Tuesday Night/Wednesday Morning In The UST Market?

By |2018-08-03T12:26:44+00:00August 3rd, 2018|Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

Why did Treasury bonds selloff on Wednesday? Obviously, we can’t ever know for sure why markets move the way they do especially in the shortest timeframes. Still, that won’t stop us from speculating anyway. The 10-year UST yield spiked just above 3% in early trading Wednesday morning. This particular drive began the night before. Treasury [...]