eurodollar system

The Relevant Word Is ‘Decline’

By |2018-12-14T16:44:35+00:00December 14th, 2018|Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

The English language headline for China’s National Bureau of Statistics’ press release on November 2018’s Big 3 was, National Economy Maintained Stable and Sound Momentum of Development in November. For those who, as noted yesterday, are wishing China’s economy bad news so as to lead to the supposed good news of a coordinated “stimulus” response [...]

Curious Rush To Combine German Banks

By |2018-12-12T18:21:31+00:00December 12th, 2018|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

Markets today celebrated more bad news out of Germany. Misunderstanding especially in stocks is par for the course, not that it’s much better outside of them. German officials are laying the groundwork to change the nation’s banking laws so that it’s two largest banks, really “banks”, can more easily combine. If it should ever come [...]

US Banks Haven’t Behaved Like This Since 2009

By |2018-12-11T17:59:34+00:00December 11th, 2018|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

If there is one thing Ben Bernanke got right, it was this. In 2009 during the worst of the worst monetary crisis in four generations, the Federal Reserve’s Chairman was asked in front of Congress if we all should be worried about zombies. Senator Bob Corker wasn’t talking about the literal undead, rather a scenario [...]

Contours of Crunch

By |2018-12-10T19:02:50+00:00December 10th, 2018|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

There are several points of confluence between financial markets and the real economy. Asset price volatility can produce negative effects on confidence, of course, forcing economic agents to reconsider their own business activities. More than that, in the gigantic bond market, in particular, a turn in pricing regimes is often accompanied by the dreaded credit [...]

Rising Risks India

By |2018-12-10T18:04:09+00:00December 10th, 2018|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

Banking regulation is never easy. Shifting regimes and tightening things up a bit during a rip-roaring global economy, however, makes it much less stressful. Among global banking systems the one in India has lagged. Much of the rest of the world had moved on to higher capital requirements in addition to (sappy) liquidity constraints long [...]

China Going Back To 2011

By |2018-12-10T12:33:58+00:00December 10th, 2018|Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

The enormous setback hadn’t yet been fully appreciated in March 2012 when China’s Premiere Wen Jiabao spoke to and on behalf of the country’s Communist governing State Council. Despite it having been four years since Bear Stearns had grabbed the whole world’s attention (for reasons the whole world wouldn’t fully comprehend, specifically as to why [...]

Cue The Bad

By |2018-12-03T19:39:17+00:00December 3rd, 2018|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

When the FOMC published the minutes for its November policy meeting, they included an unusually lengthy discussion about federal funds (effective) and IOER. I have no doubt that policymakers would rather have skipped the topic altogether. Demonstrating how little they actually control matters, the plight of EFF has forced them into an almost detailed digression. [...]