You Don’t Have To Take My Word For It

By |2022-01-24T20:28:40-05:00January 24th, 2022|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

Stop me if you’ve heard this before. Longtime readers/followers/enthusiasts will be forgiven for immediately thinking I’m quoting myself again, as I so often do: Following its emergence, the eurodollar market played a big role in the Bretton Woods system and also its breakdown and eventual demise in the early 1970s. The primary reason I refer so much to my own [...]

It’s the First Not Last Place To Start

By |2022-01-24T18:10:50-05:00January 24th, 2022|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

The term “geopolitics” has a specific meaning, though in the context of assessing markets and their equally ubiquitous though purposefully non-specific “jitters”, it’s basically a catch-all, too. Should the stock market, in particular, take a bad step, reflexive commentary is quick to call up geopolitics. Such was absolutely the case late in January 2018 into the following month of February. [...]

The Hawks Circle Here, The Doves Win There

By |2022-01-21T18:44:35-05:00January 21st, 2022|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

We’ve been here before, near exactly here. On this side of the Pacific Ocean, in the US particularly the situation was said to be just grand. The economy was responding nicely to QE’s 3 and 4 (yes, there were four of them by that point), Federal Reserve Chairman Ben Bernanke had said in the middle of 2013 it was becoming [...]

Good Time To Go Fish(er)ing Around The Yield Curve

By |2022-01-20T20:01:52-05:00January 20th, 2022|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

It should be as simple as it sounds. Lower LT UST yields, less growth and inflation. Thus, higher LT UST yields, more growth and inflation. Right? If nominal levels are all there is to it, then simplicity rules the interpretation. Visiting with George Gammon last week, he confessed to committing this sin of omission. Rates have gone up, he reasoned [...]

Deeper Into The Weeds of TIC For Red, Blue, And Collateral

By |2022-01-19T19:40:55-05:00January 19th, 2022|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

Why are US banks borrowing hundreds of billions of US “dollars” (quotation marks fully deserved given the nature of these borrowings which are neither physical currency nor easily identifiable even on the global ledger, too many classified here as “other”) from themselves? Technically, for regulatory and accounting purposes “American” banks (a classification which includes domestic subsidiaries of foreign banks) are [...]

Flipping Several Scripts

By |2022-01-18T19:54:15-05:00January 18th, 2022|Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

The script has been flipped, so to speak, this time around. Whenever we’d go through one of those regular, alternating downturns worldwide, like the one which began right from the start of 2018, it was services which held up the increasingly troubled manufacturing sector. The variation for the swing, from globally synchronized growth to globally synchronized downturn, was mostly contained [...]

What Kind of Tiger ‘Needs’ Wings?

By |2022-01-18T18:34:43-05:00January 18th, 2022|Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

Chinese Communists, like their counterparts everywhere around the world, they do love their metaphors. Speaking virtually at Davos again in 2022 like he had in 2021, the theme was largely the same. A year ago, China's dictator had warned about the uncertainty of the global recovery, a celebratory party only then getting going around those parts; he got that one [...]

Eurodollar Futures Curve Update (spoiler: still inverted)

By |2022-01-14T20:00:49-05:00January 14th, 2022|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

I guess I took my own advice a little too literally. I did write that when the eurodollar futures curve first inverted, it was going to be dull. Didn’t start out that way, of course, with a small bit of theatrics right during that front week in December when the inversion first showed up. Ever since then, it has stuck [...]

The Historic Christmas Binge

By |2022-01-14T17:00:05-05:00January 14th, 2022|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

The reason that store shelves are occasionally empty, as any social media hashtag trend will tell you, is that Americans are still buying an amazing amount of goods. For December 2021, Christmas was hardly canceled. The Census Bureau today reported that retailers during the biggest month of last year, of every year, grabbed an astoundingly huge $714 billion in overall [...]

Go to Top