This is all starting to look very familiar and predictably so: Especially this: It is utterly extraordinary that the June 2023 eurodollar futures contract closed trading at 98.00, much less than on February 11 and a collapse of more than 150 bps in anticipated 3M LIBOR seven years in the future just since last July. It is, again, entirely anticipated given the [...]
So the FOMC voted against another rate hike yesterday, which in itself deserves no comment. Not even Esther George could muster a dissent as she has done nine of the previous eleven times. Notably the last time Ms. George voted with the all the rest of the committee against the symbolic raising of the irrelevant federal funds rate was the [...]
The Treasury International Capital (TIC) update for April showed a very large net decline in foreign (registered) holdings of US securities. The total net drop was $68.7 billion, the largest in one month since the severe “dollar warning” in June 2013. Though we have become accustomed to these kinds of results, the biggest factor in April 2016 was on the [...]
Last week, the National Bureau of Statistics in China released what seemed like import levels that suggested “stimulus” was finally paying off and the economy had struck bottom. Among these more glowing results was an absolute surge in the importation of oil, which was blindly parroted as if Chinese demand due to the expected economic revival were the cause. Instead, [...]
Industrial production fell year-over-year in May 2016 for the ninth consecutive month. At -1.4%, it is the same kind of slow, steady contraction now that we find in so many other places. This is not the typical recession response, instead more consistent with the slowdown turning into serious than just insufficient growth while still at the precipice of potential recession. [...]
Inventory is an exceedingly simple concept spaced between the most basic economic fundamentals. Because the modern economy operates upon mass production, the flow of goods is not direct. Thus, there are structural differences between demand and supply, with inventory as the pivot in between. If end demand rises it still gets filled even though production cannot respond instantaneously (no matter [...]
Walter W. Heller was said to have been an “educator of Presidents.” As an economist and Presidential advisor in the inner circles of DC, Heller worked with more candidates and officeholders than perhaps any other man. As he himself described, his influence went all the way back to Adlai Stevenson and kept on through Kennedy, Johnson, Carter, and Mondale. To [...]
As with other economic accounts, retail sales dropped back in May after the temporary rebound coincident to calendar effects. Overall sales, including autos, grew just 1.9% over May 2015, well below the 3% level that historically defines recessionary conditions. That growth rate was the 39th worst in the entire data series (out of 281 months), placing it in the lower [...]
If there seems to be more safe haven demand of late, the increasing odds of British exit from the EU is being blamed. According to Yahoo!Finance, Goldman Sachs sees “kinks” in the option structure, an agglomeration of hedging demand that points to maturities around the UK referendum. The absence of any heavy hedging this week suggests that markets have no [...]
As always, there is the attempt to put a brave face on what is shaping up to be the worst year yet. China’s “big 3” economic data were all disappointing in the context of what the last “brave face” was supposed to suggest – where weakness at the start of the year was only due to “global turmoil” and would [...]
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