Auto sales in 2019 ended on a skid. Still, the year as a whole wasn’t nearly as bad as many had feared. Last year got off on the wrong foot in the aftermath of 2018’s landmine, with auto sales like consumer spending down pretty sharply to begin it. Spending did rebound in mid-year if only somewhat, enough, though, to add [...]
It wasn’t actually Keynes who coined the term “pump priming”, though he became famous largely for advocating for it. Instead, it was Herbert Hoover, of all people, who began using it to describe (or try to) his Reconstruction Finance Corporation. Hardly the do-nothing Roosevelt accused Hoover of being, as President, FDR’s predecessor was the most aggressive in American history to [...]
Germany’s vast industrial sector continued in the tank in September. According to new estimates from deStatis, that country’s government agency responsible for maintaining economic data, Industrial Production dropped by another 4% year-over-year during the month of September 2019. It was the fifth consecutive monthly decline at around that alarming rate. Four percent doesn’t sound like much, but in the context [...]
When I first got in this business oh-so-many years ago, my mentor told me that I shouldn't waste my time worrying about the things everyone else was worrying about. As I've related in these missives before, he called those things "well-worried". His point was that once everyone was aware of something it was priced into the market and not worth [...]
One year ago, last October, the IMF published the update to its World Economic Outlook (WEO) for 2018. Like many, the organization began to talk more about trade wars and protectionism. It had become a topic of conversation more than concern. Couched as only downside risks, the IMF still didn’t think the fuss would amount to all that much. Especially [...]
For every action there is a reaction. Not only is that Sir Isaac Newton’s third law, it’s also a statement about human nature. Unlike physics where causes and effects are near simultaneous, there is a time component to how we interact. In official capacities, even more so. Bureaucratic inertia means a lot more than just resistance to change, it also [...]
It’s another one of those things that just blows up the whole convention, another pretty clear sign that the mainstream has it all backward. We are seeing it play out right now with China. The Chinese are being accused of unfair currency manipulation, the sort of “competitive devaluation” that fills whole chapters in the Keynesian Economics textbooks. The idea is [...]
The European slump had been a combination of several transitory factors. At least that’s what they had kept saying. ECB officials and staff Economists didn’t use that specific word, so far that’s the exclusive domain of the Federal Reserve. Regardless of semantics, the message was clear: the 2018 economy ended on a sour note but that was nothing to be [...]
The US manufacturing sector may not be in as bad a shape as its German or Japanese counterparts, though it appears to be catching up on the downside. The Census Bureau reports today that new orders for all types of goods in all industries fell 1.6% year-over-year (unadjusted) in May 2019. This was the first minus sign for the broad [...]
No Federal Reserve Chairman under its current configuration can say QE didn’t work. Those words will never pass the lips of whoever it may be occupying that position. The world’s bond markets, however, are trying very hard to make this resistance as uncomfortable as possible. The one thing central bankers here along with everywhere else LSAP's were unleashed could try [...]
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