As we move past all the calendar effects pressed to the front of each year, some trends are starting to come into view. Not only are there trends but a few round numbers, even. The Chinese monetary system is one that is predicated on “dollars”; not all in dollar-denominated assets, but the type of foreign reserves that are consistent with [...]
On December 3, 1999, Enron Communications announced that the company had begun operations selling bandwidth as an energy commodity. After publicizing the venture in May that year, it seemed natural given that they had been selling similar products in the energy sector, pioneering all sorts of products along the way. As the internet matured there was no way Enron would [...]
I don’t pay much attention to the 2 year part of the UST curve because I think it is susceptible to information spoilage, distortions that aren’t strictly related to what a “risk-free” 2s should tell us. But as my colleague Joe Calhoun often reminds me, just because I don’t think it as important doesn’t mean that other people see in [...]
What is truly frustrating is that only now is the world trying to come to terms with the last ten years, and only because it ignored the major, seismic developments over the preceding forty. It’s not a question of too little, too late, it’s more so that after being bludgeoned with failure there are no leaps of intuition, merely baby [...]
What is about math that makes us feel comforted? Numbers are objective, of course, but the using of numbers is not. Even in the hard sciences calculations are not strictly calculations for their own sake, they are interpreted and therefore given subjective meaning. I don’t intend to detour this argument into a teleological one, but in some ways that just [...]
One of the most prominent features of the “rising dollar”, if not the “rising dollar” itself, was an almost out of control shortage in FX basis. Though cross currency basis swaps with Japan received all the attention, with very good reason, the basis was off against the euro, franc, and a host of other majors. These things happen from time [...]
TIC data confirms that “reflation” captured more than just pricing sentiment. It appears to have occurred in bank balance sheet activity, and related official sector UST transactions. As to the latter, official holdings of US$ assets did decline on net in March 2017, the latest figures, including more selling of UST’s. The scale of the decline was less than we [...]
Progressive New York Magazine columnist Jonathan Chait writing for the leftist New Republic in 2010 prophesied that if the Republicans took Congress that year and Obama won a second term two years after, “the House will vote to impeach him before he leaves office.” He was confident enough to make such a prediction because that is post-Nixon politics; they got [...]
Earlier this month, China’s State Administration of Foreign Exchange (SAFE) reported a large increase in official reserve holdings. The biggest “inflows” in several years has, as you would expect, led to much optimistic commentary suggesting if not outright stating that the currency problems are no more. It is not the first time such claims have been made, as this has [...]
Despite a lower calculated inflation rate for April 2017, Real Average Weekly Earnings were only just positive for the month year-over-year. As the CPI had moved higher on the base effects of oil prices, real earnings were forced negative in each of the three prior months. The reason is, as always, no acceleration in nominal wages or earnings. None. Given [...]
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