Since the Federal Reserve is not in the money business, their recent hawkish shift toward an increasingly anti-inflationary stance is a twisted and convoluted case of subjective interpretation. Inflation is money and if the Fed was a central bank the issue of consumer prices wouldn’t necessarily be simple, it would, however, be much simpler: is there or isn’t there too [...]
The guy was, as usual, explicitly candid when he spoke to his crowd of global billionaires. The Davos gathering of the superrich does much for generating clickbait headlines, though typically followed by the most nondescript phrases only passed off as useful insight. In this setting, Xi Jinping really has been the disruptor.How’s that for irony?Their message - they being everyone [...]
The economy was in danger of running hot, too hot they all said. In order to stay ahead of such inflation potential, as central bankers saw it, first it would be necessary to wind down quantitative easing. Taper then terminate. After that, rate hikes.Hawks buzzing around everywhere.But Mario Draghi’s ECB had a problem. The inflationary pressures were there, he reasoned, [...]
Chinese run media, the Global Times, blatantly tweeted an homage to China's late leader Mao Zedong commemorating his 128th birthday. Fully understanding the storm of controversy this would create, with the Communist government’s full approval, such a provocation has been taken in the West as if just one more chess piece played in its geopolitical game against the United States [...]
We’re only ever given the two options: the economy is either in recession, or it isn’t. And if “not”, then we’re led to believe it must be in recovery if not outright booming already. These are what Economics says is the business cycle. A full absence of unit roots. No gray areas to explore the sudden arrival of only deeply [...]
If there is a better, more fitting way to head into the Christmas holiday in the United States than by digging into the finances and monetary flows of the People’s Bank of China, then I just don’t want to know what it is. Contrary to maybe anyone's rational first impression that this is somehow insane, there’s much we can tell [...]
With the eurodollar futures curve slightly inverted, the implications of it are somewhat specific to the features of that particular market. And there’s more than enough reason to reasonably suspect this development is more specifically deflationary money than more general economic concerns. What I mean is, those latter have come later (“growth scare”) only long after the world’s real money [...]
How does QE work? That’s actually a trick question given how all the evidence produced in examination of the various programs undertaken across the world under that label uniformly indicates that it doesn’t. On the contrary, the most studied and tested government efforts in history have yielded consistent results up and down the board.It's just that the public has never [...]
Have oil producers shot themselves in the foot, while at the same time stabbing the global economy in the back? It’d be quite a feat if it turns out to be the case, one of those historical oddities that when anyone might honestly look back on it from the future still hung in disbelief. Let’s start by reviewing just the [...]
Seems like ancient history given all that’s happened since, but on October 13 Treasury Secretary Janet Yellen announced a planned deluge of cash management bills in the wake of the debt ceiling resolution (the first one). The next day, China’s currency, CNY, broke free from its previous and suspiciously narrow range. Speculating a connection a few days thereafter, I wrote: [...]
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