When Bear Stearns nearly failed, made to merge, in March 2008 it wasn’t really a surprise. Yes, markets were shocked by the demise of the ancient firm, one of the bulge bracket cartel which suggested surprise over the severity of it more than that things were going bad. For more than a year, starting in early 2007, Bear had been [...]
At the end of his life and career, F. Scott Fitzgerald, the great American novelist, wrote a series of short stories for Esquire Magazine. It’s difficult to tell whether he was forced into the job, far as it might have seemed from the 1920’s salons of Paris carousing with his wife Zelda and other international intellectual luminaries of the time. [...]
Bundesrepublik Deutscheland Finanzagentur GmbH (German Finance Agency) was created on September 19, 2000, in order to manage the German government’s short run liquidity needs. GFA took over the task after three separate agencies (Federal Ministry of Finance, Federal Securities Administration, and Deutsche Bundesbank) had previously shared responsibility for it. On September 17, 2014, almost exactly fourteen years later, GFA managed [...]
Rather than bury this chart in my earlier discussion of liquidity preferences, I felt it deserved its own piece to highlight what it shows. By all traditional and orthodox Economics, this just should not be possible. Yet, there it is and it’s not the only example of violation. For very different markets as robust as each one is, there should [...]
There was an extremely odd dynamic for monetary policy during the 1990’s and especially in the United States. The less Alan Greenspan said, the more markets were convinced he knew what he was doing. He purposefully said nothing, being attributed years later with developing this “fedspeak.” So long as he continued to say nothing, the more he would have to [...]
If more people desire a certain thing, in a free market the price of that certain thing will go up regardless of any possible inherent value. Indeed, that is how market consensus is supposed to work, the backbone of efficient markets. I don’t believe that markets are or ever can be perfectly efficient, especially in the current age where assumptions [...]
After being pummeled by a concurrent stock and real estate crash, Japanese officials by late 1992 felt that enough was enough. The Nikkei 225 stock index that was nearly 40,000 toward the end of 1989 had crashed to below 15,000 by August 1992. From that point, however, Japanese stocks had started rising again. Through the summer of 1992, things looked [...]
A strong cohort of global PMI’s has cheered today pretty much everyone, from economists to the media and anyone else in between. China’s official Manufacturing PMI was calculated at 51.2 in October, the highest level since July 2014, up seemingly significantly from the 49.9 just three months ago this July. In the United States, the ISM Manufacturing rose again to [...]
When I wrote on Friday that I was encouraged for the first time in years over the combined rise of Trump and Sanders I meant nothing by way of suggesting either as an actual candidate or what they might do should they pull it out. If anything, I implied that the political situation might have to follow the economy; that [...]
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