fbpx

inflation breakevens

CPI Comes ‘Home’ To The Other Side of Inverted TIPS

By |2021-09-14T16:52:43-04:00September 14th, 2021|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

January 2021 was, it may have seemed, only the start of something big. Huge. Colossal. Coronavirus vaccines had been discovered, publicized, and rolled out, meaning for the first time a real shot at ending the pandemic. The world could quickly get back to normal, the economy recovering its footing, and between January and that bright future Uncle Sam was going [...]

What CPI (and PPI)?

By |2021-05-13T19:30:20-04:00May 13th, 2021|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

The way it has been described since, yesterday’s CPI estimates for last month represented a seismic shift in the inflation debate. There is no more argument, apparently, and if that wasn’t apparent enough then today it was followed up with even more highly-touted evidence. Producer prices, the PPI, came up even more over-the-moon than those for consumers.The commodities portion, no [...]

Reopening 2 Is Real And Spectacular, So Why So Much Angst?

By |2021-05-06T19:39:07-04:00May 6th, 2021|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

Reopening 2 is definitely happening. The labor market, in particular, is sending off the same kind of signals if not to the same huge extent as it had during Reopening 1 in May and June of last year. The March 2021 payroll report was better than 900,000, and the one for April (last month) to be released tomorrow is expected [...]

Dressed Up Delusions of Bad Math: The False Term Premium Inflation Promise

By |2021-05-05T18:20:01-04:00May 5th, 2021|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

Deconstructing long-term interests may seem like a purely academic exercise. This is certainly how Economists treat it, coming at them using their statistical models. The goal is always to properly interpret these most basic of economic, financial, and monetary fundamentals so as to understand where everything that matters stands. Getting this wrong is the difference between night and day; between [...]

What Is It About TIPS 5s Auctions? What Was It About *This* One?

By |2021-04-23T17:48:41-04:00April 23rd, 2021|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

Since we’re still on the topic of Treasury auctions, here’s another one to take a closer look at. Yesterday, Treasury sold $18 billion in 5-year TIPS – the inflation protected security (91282CCA7) – and though there were plenty of bids they came in at prices somewhat out of whack with the secondary market. This left two-thirds of the offering to [...]

The Consensus

By |2021-04-16T19:51:39-04:00April 16th, 2021|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

With government cash being shoveled into personal and corporate bank accounts, US consumers have reported that they are being more optimistic about the state of the economy. Before that, they went on a spending binge as stated unequivocally by historic retail sales figures. Why, then, so much higher spending than improved happiness and certainty while going about it?The University of [...]

Scorching, Blistering, Highest In A Decade! Powell’s The Voice of Reason Here?

By |2021-04-09T18:17:50-04:00April 9th, 2021|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

If there is one thing Economists understand very well, it’s mathematics. This is practically all they do, and all that means much to their discipline. If there’s one thing Economists don’t seem either competent with or interested in, it’s the economy. The math is supposed to match the other’s reality, yet rarely does.There are times, however, when simple calculation is [...]

TIPS Tipping Over, But Not That Way

By |2021-03-04T19:45:37-05:00March 4th, 2021|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

There is precedence for this, though not to this extent; it has reached a record. And when it happened before, oil prices were right in the middle of it, too. The 5-year TIPS breakeven rate has surged to equal its highest in a very long time. Considered by many evidence for an inflationary breakout – these are inflation breakevens, after [...]

Three Things About Today’s UST Sell-off, Beginning With Fedwire

By |2021-02-26T18:09:25-05:00February 25th, 2021|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

Three relatively quick observations surrounding today’s UST selloff.1. The intensity. Reflation is the underlying short run basis, but there is ample reason to suspect quite a bit more than that alone given the unexpected interruption in Fedwire yesterday.At 12:43pm EST, most of FRBNY’s electronic services experienced an as-yet unexplained problem which interrupted service, including that of Fedwire. To this point, [...]

Go to Top