Long end UST yields on the rise with reflation-y factors taking more of a hold, last year’s postponed YCC flirtation is almost certain to be rekindled over the weeks ahead. We’ve been told how it’s really simple, meaning low interest rates are stimulus and this must be maintained without fail. But what’s really been responsible for all the failing?When I [...]
The idea behind post-Georgia reflation is that globally fiscal-led “stimulus” will be enough to fix what’s still wrong. The economy broke down, by choice, last year but with sufficient zeroes behind governments spending around the world, from DC to Brussels and a bunch in between, whatever costs and consequences remaining due from 2020 aren’t going to be unmanageable for 2021. [...]
46.1 Interbank Netting: The Pressure to Get to ZeroPrivate banks fund global economic activity. But how do they move money among themselves? We consider the November 20, 1985 software glitch that shocked the interbank market. Then, a brief history of Fedwire, Telex, SWIFT and CHIPS. Finally, September 2019's repo market freeze. [Emil's Summary] Having studied monetary policy for several years [...]
For Jay Powell’s inflation case, the University of Michigan provided it with some badly needed support. Telling the world he “flooded” it with “digital money printing” three-quarters of a year ago, actual inflation rates have instead fallen down to or near historic lows. No biggie, those in Powell’s corner say, just a matter of time before this changes (commodities!), possibly [...]
Sometimes, the government will tell you a lot when it really doesn’t want to tell you anything. It’s not what they say, but what they don’t. In the case of the Treasury Department, there was a small, seemingly nondescript morsel buried down underneath the rest of its more immediately consequential next-quarter projections. While focused, quite rightly, on the scaling back [...]
45.2 Examining the Post-Covid Economic ReflationWe look through the lenses of the dollar, Treasury yields, inflation breakevens, swap spreads to see how this Post-Covid reflation compares to the three economic recoveries of the past 13 years: Green Shoots (2009-10), Global Growth (2012-14) and Globally Synchronized Growth (2016-18). ———WHO——— Twitter: https://twitter.com/JeffSnider_AIPTwitter: https://twitter.com/EmilKalinowskiArt: https://davidparkins.com/ Jeff Snider, Head of Global Investment Research for Alhambra Investments with [...]
Nevada is, by all accounts and accountants, in rough shape. Very rough shape. An economy overly dependent upon a single industry, tourism, in this case, is a disaster waiting to happen should anything happen to that industry. Pandemic restrictions, for instance.Nevadans cannot afford the government spending they “have” without a gaming industry attracting visitors at full throttle. Desperate, the state’s [...]
Japan is just the name of a group of large islands on the far side of the Pacific from the United States. For most people, there’s not much else more to say beyond the charm of weird, ofttimes masochistic tendencies embedded within the inscrutably fascinating Japanese gameshows. Maybe something about suicidal demographics. The financial media has done such a poor [...]
If the payroll numbers are old news because they aren’t supposed to matter anymore, what with TGA drawdowns and vaccines, then JOLTS figures one month further behind them must count for even less. Gradation does factor here, though, and that’s why it’s important to keep the current and slightly-in-arrears data in mind.What I mean is that the stimulus-frenzy narrative does [...]
Even the feds haven’t been able to keep up. Without the government having taken over student loans in the wake of 2008-09’s Great “Recession”, there’d have been almost no additional consumer credit extended during the decade since. It’s one more facet to the recovery-less recovery; like Japan, a dominant even overbearing government influence that doesn’t stimulate anything but its own [...]
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