Looking Back At Chaotic March Through TIC

By |2022-05-18T20:30:35-04:00May 18th, 2022|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

March ended up being a pretty wild ride. Lost amidst the furor over Russia’s invasion of Ukraine, the month began with a couple clear “collateral days. T-bill rates along with repo fails echoed that same shortfall before the yield curve then joined the eurodollar futures curve being inverted. It really hasn’t been the same since.Looking back on it using the [...]

Shipping Around Retail ‘Inflation’

By |2022-05-17T20:11:05-04:00May 17th, 2022|Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

This whole “inflation” scenario isn’t really that difficult to piece together, effect from cause. Sure, Jay Powell’s trying to nuke it by hiking the federal funds rate, but no one really uses fed funds and the problem isn’t the unsecured cost of borrowing bank reserves (not money) that are literally overflowing. For one, the FOMC’s efforts aren’t going to get [...]

Synchronized Not Coronavirus

By |2022-05-17T17:55:34-04:00May 17th, 2022|Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

There is an understandable tendency to just write off this weekend’s disastrous Chinese data as nothing more than pandemic politics. After all, it has been Emperor Xi’s harsh lockdowns spreading like wildfire across China rather than any disease (why it has been this way, that’s another Mao-tter). Open the cities back up, as many are doing right now, the world [...]

Weekly Market Pulse: TANSTAAFL

By |2022-05-16T07:41:16-04:00May 15th, 2022|Alhambra Portfolios, Bonds, Commodities, Currencies, Markets, Real Estate, Stocks|

TANSTAAFL is an acronym for "There ain't no such thing as a free lunch". It has been around a long time - Rudyard Kipling used it in an essay in 1891 - but it was popularized by Robert Heinlein's 1966 book, "The Moon is a Harsh Mistress". In economics, it most often refers to tradeoffs or opportunity costs; resources are [...]

Crude Contradictions Therefore Uncertainty And Big Volatility

By |2022-05-13T17:59:34-04:00May 13th, 2022|Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

This one took some real, well, talent. It was late morning on April 11, the crude oil market was in some distress. The price was falling faster, already down sharply over just the preceding two weeks. Going from $115 per barrel to suddenly less than $95, there was some real fear there.But what really caught my attention was the flattening [...]

Synchronizing Chinese Prices (and consequences)

By |2022-05-12T20:28:47-04:00May 12th, 2022|Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

It isn’t just the vast difference between Chinese consumer prices and those in the US or Europe, China’s CPI has been categorically distinct from China’s PPI, too. That distance hints at the real problem which the whole is just now beginning to confront, having been lulled into an inflationary illusion made up from all these things.To start with, yesterday China’s [...]

Peak Inflation (not what you think)

By |2022-05-11T22:02:59-04:00May 11th, 2022|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

For once, I find myself in agreement with a mainstream article published over at Bloomberg. Notable Fed supporters without fail, this one maybe represents a change in tone. Perhaps the cheerleaders are feeling the heat and are seeking Jay Powell’s exit for him? Whatever the case, there’s truth to what’s written if only because interest rates haven’t been rising based [...]

Industrial Synchronized Demand

By |2022-05-10T20:05:48-04:00May 10th, 2022|Bonds, Commodities, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

Are the industrial commodities starting to get a whiff of demand side rejection? Short run trends suggest that this could be the case. From copper to iron and the highest (formerly) of the high flyers, aluminum, this particular group has been exhibiting a rather synchronized setback going back to the end of March, start of April.This despite supply bottlenecks and [...]

Eurobonds Behind Euro$ #5’s Collateral Case

By |2022-05-10T18:38:41-04:00May 10th, 2022|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

The bond market is allegedly populated by the “smart” set, whereas those trading equities derided as the “dumb” money (not without some truth). I often wonder if it’s either/or. The fixed income system just went through this scarcely three years ago, yet all signs and evidence point to another repeat. So, how smart can Eurobond agents really be if they’ve [...]

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