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treasury curve

Curve (Not) Crazy

By |2018-12-04T13:20:46-05:00December 4th, 2018|Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

On August 30, 2006, the Bureau of Economic Analysis (BEA) reported preliminary estimates for US Gross Domestic Product (GDP) in the second quarter. It was figured back then that domestic output increased 2.9% over the first quarter, seasonally adjusted, somewhat of a decrease from the robust start to 2006. Final estimates for Q1 thought the economy had advanced 5.6% during [...]

Cisco And Target Are Not Really About Cisco Or Target

By |2016-08-17T12:48:59-04:00August 17th, 2016|Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

The words of the day are apparently “sluggish” and “challenging.” Overnight both Target and Cisco, bellwethers in retail and tech, respectively, were both the subject of intense scrutiny. Target released earnings that “beat” while revenues and really same store comps were particularly weak. Year-over-year, sales declined 7.2% total (revenues from Q2 2015 include Target’s pharmacy business which was sold to [...]

What Current Interest Rates Really Mean

By |2016-06-23T18:55:15-04:00June 23rd, 2016|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

On June 14, the 10-year German bund yield traded briefly below zero for the first time. It was an inauspicious record but one that defines the contradictions at the center of all this economic and monetary controversy. On the one hand, that is what central banks tell us they are after especially with QE, to reduce interest rates even at [...]

No Confidence Vote – Raging RHINO

By |2016-02-02T20:28:27-05:00February 2nd, 2016|Economy, Federal Reserve/Monetary Policy, Markets|

FOMC Voting Member Esther George issued a vote of confidence for the economy, despite financial turmoil returning across asset markets again today. With front month WTI back under $30, her idea of a strong economy and anchored inflation expectations is still highly imperiled. She remains completely dogged, however, undeterred for further “normalization” of monetary policy largely as the US economy [...]

Reading Curves and Finding Only the Death of Money

By |2016-01-11T18:58:21-05:00January 11th, 2016|Bonds, Commodities, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

When analyzing the full and true nature of the dissonance between the idea of continued recovery and the financial markets’ scenario for something much worse you realize that this is not a new occurrence. In curve after curve, negativity has been building for years. Financial curves are important because they tell us the health of the monetary economy, namely assumptions [...]

Late 2014 ‘Dollar’ Is Back

By |2015-07-23T11:09:02-04:00July 23rd, 2015|Bonds, Economy, Federal Reserve/Monetary Policy, Markets|

If there is something different about the “dollar” in July it is that it has been in widespread pressure on funding. From early May to the beginning of July, the “dollar” was more hit and miss with only regional or limited disruption. Crude prices, for example, rising since the March FOMC, stopped but then traded sideways rather than appreciably lower. [...]

Did Friday’s UST Selloff Change Anything?

By |2015-03-09T16:58:32-04:00March 9th, 2015|Bonds, Economy, Federal Reserve/Monetary Policy, Markets|

The large selloff in UST on Friday has left many wondering what happened. While the jobs report was certainly a catalyst, it wasn’t really out of line with prior months. It’s not as if credit markets were suddenly awakened to the possibility that Yellen’s FOMC may do what it says, so I don’t think that the Establishment Survey provided any [...]

A Different Kind of Inversion

By |2014-12-19T19:00:23-05:00December 19th, 2014|Economy, Federal Reserve/Monetary Policy, Markets|

One of the most curious aspects of the FOMC’s apparent rush to end its “accommodation” is the distinct lack of any market-based reinforcement. Using only statistical analysis of economic accounts, the Fed is, in effect, saying that it is ignoring all market indications contrary to its main assessment. That extends not just to overall economic measures but also, referring to [...]

Credit Markets Embrace ‘Noise’, But That Is Hardly Reassuring

By |2014-07-02T15:39:56-04:00July 2nd, 2014|Economy, Federal Reserve/Monetary Policy, Markets|

If the Federal Reserve is on course to “normalize” monetary policy within the context of a self-sustaining recovery, nobody told the credit markets. That isn’t quite true, though, as investors in the credit markets have been inundated with such talk and speculation for a some time; they are apparently just ignoring it. At best, the most that can be said [...]

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