I was told many years ago when I started in this business that it wasn't my job to predict the future. Our job as investors is to properly and accurately interpret the present. I was also told that wasn't as easy as it sounded and the current consensus about the state of the world was probably, almost certainly, almost always, [...]
All the signs were there, starting with the fact that the Fed and ECB together had supposedly the flooded the world with digital money yet a palpable “something” was really off. Ben Bernanke’s central bank had unleashed both ZIRP and QE, the latter of which had finished up a couple months before. In Europe, Jean Claude-Trichet’s outfit was “highly accommodative” [...]
DISCLAIMER: The opinions expressed within the content are solely the author's and do not reflect the opinions and beliefs of the website or its affiliates. 48.0 Reading Around: Myrmikan on System-Critical Short Squeezes Financial historian Daniel Oliver's essay on the systemic consequence of the 1907 short squeeze on United Copper Company and lessons for today. A reading, by Emil Kalinowski. [...]
50.0 Why Economists Kept Getting the Policies WrongJeff Snider reacts to two recent articles: "Bond yields are not good predictors of inflation" (Peterson Institute for International Economics) and "Why economists kept getting the policies wrong" (Financial Times). ———SPONSOR——— But first, this from Eurodollar Enterprises! The motion picture event of the summer: (Con)Tango & Cash. When an international smuggling ring uses the [...]
According to the Federal Reserve’s preferred inflation measure, the PCE Deflator, consumer price pressures remained muted in January 2021. No surprise, given the absence of inflationary conditions contained within the prior released CPI report for the same month, as even the contribution from surging oil prices was noticeably minimal in both. The Bureau of Economic Analysis (BEA) today said that [...]
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, [...]
49.3 Week 48 of 'Record' Jobless ClaimsLearn how to reconcile a positive surge in retail sales with a nightmare string of 'record' jobless claims and lousy sentiment reported by the University of Michigan consumer survey. Perhaps pent up demand? Maybe. An unusual, poorly explained seasonal adjustment boost? Maybe too. ———SPONSOR——— But first, this from Eurodollar Enterprises! The motion picture event [...]
For a couple of weeks, the $600 payments from Uncle Sam seemed to have found their way into the tanks of Americans driving their automobiles a little bit more than they had. According to the US Energy Information Administration (EIA), the total amount of gasoline “supplied” by the domestic marketplace reached 8.4 mbpd the second week of February. Like retail [...]
Fear of the ultra-inflationary aspects of fiscal overdrive. This is the current message, but according to what basis? Bigger is better, therefore if the last one didn’t work then the much larger next one absolutely will. So long as you forget there was a last one and when that prior version had been announced it was also given the same [...]
49.2 Do Not Rule Out a Market Panic Next MonthA Financial Times column warns of a US Treasury Bill air pocket in March. Learn the little-known history of a mid-market, 1970s German bank that compelled regulators to move towards capital and supplementary leverage ratios. The very ratios that may now trigger uncertainty. ———WHO——— Twitter: https://twitter.com/JeffSnider_AIPTwitter: https://twitter.com/EmilKalinowskiArt: https://davidparkins.com/ Jeff Snider, Head of Global Investment [...]
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