201503.27
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Cash Flow Seems To Explain Why 5% GDP Was A Myth (Among Other Discrepancies)

Coincident to the “final” release of quarterly GDP are the updated estimates for corporate profits. While the Q4 headline didn’t much alter from the preliminary version sent out a month ago, there was much in the profit section relevant to both economic cycle and structure. The BEA provides several different breakouts of business profits, but…

201503.26
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FOMC: Not Only Is There No Recovery, Don’t Ever Expect One

Taking a look back at economic projections from orthodox models (and the theories they incorporate and encompass) is more than just a review of past econometric failures. That is the most obvious component as the ability of mainstream models to forecast actual economic conditions is inarguably flawed beyond repair. That calls into question, certainly, current…

201503.25
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A Realistic Scenario For Unrealistic New Homes

At first glance, yesterday’s release of new home sales estimates defied any sense of sense. As such, it seemed better to simply let it alone until revisions attempt to address the extreme outlier results for February. However, after further review, there may be another factor to consider as to whether there is anything worthwhile rather…

201503.25
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Durable Goods Take February Too

So far the economic retrenchment has persisted into February, outlasting any significant January weather. The latest worrisome figures came in the form of durable goods and especially capital goods. The former is another peg in the consumption side while the latter is one of the few glimpses of wealth creation (if far from a complete…

201503.24 0

Distinguishing Curves

While the more interesting action has shifted to funding markets, the treasury curve remains at least relevant to the analysis of all those ebbs and flows. For the most part, the yield curve in UST has found itself stuck in a rather tight range right at the bottom of the “cycle.” While that would be…

201503.20
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More Realtime ‘Dollar’ Figures

With funding markets and currencies showing pessimism once more with regard to the “dollar”, waiting for confirmation from TIC presentations is less than desirable. The Federal Reserve offers an alternate measure listed on its H.4.1 as a memoranda item. It tracks what the Fed holds in direct custody for foreign central banks and other “official”…

201503.20
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Speed Bump or New Trend for Autos?

One of the primary pillars of even the tepid “recovery” of this cycle is undoubtedly auto sales. We can have a debate as to the influence of monetary policy in this arena, especially as auto loans have (along with student loans) been practically the only direct conduit of credit into the real economy. Clearly, despite…

201503.18
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Violent Swing Back To Pessimism and Liquidity

With the FOMC throwing in the towel on the US “boom”, funding markets have knee-jerked back into the same trends as predominated during the prior liquidity events. In other words, extreme pessimism has once again intruded in eurodollars. The funding curve has exploded (imploded?) back to where it was at the early part of February,…

201503.18
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Celebrations Over QE That Doesn’t Work, So Bring More QE

Ever since the price of oil became a major economic theme last fall, even before the now-ubiquitous “dollar” though they are essentially one and the same function, economists and especially those at the FOMC have been in a rush to reassure that the oil price collapse was both going to be short-lived and a huge…

201503.16
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From Brazil to Switzerland to Texas (Really Okla)

It’s certainly not quite the “butterfly effect” but the reality of the overall arrangements of the global economy is shockingly simple. The details, methods and interactions of the “dollar” can be incomprehensible at times, especially since there is no directly observable and thus plainly unambiguous data, but once the “big” moves entrench all that complexity…