In February 2015, IHS Markit thought that the US manufacturing sector might be slowing quite against every expectation. Its final PMI reading for the month of January was 53.9, down quite a bit from highs registered in the middle of 2014. Some of those fears seemed put to rest the following month when the flash reading for February 2015 rebounded [...]
The unemployment rate isn’t just misleading in the US, though the gap between what it suggests here and what isn’t happening is now enormous. This idea of a labor shortage, or LABOR SHORTAGE!!!! as each case may be, was itself as global as synchronized growth when it showed up in later 2017. There were stories about Chinese factories unable to [...]
It infects every boardroom across the world. Big business requires decent forecasting, yet time and again it seems they are deprived of what they desperately need. Instead, even after this last decade, the world’s largest companies continue to be surprised by weakness that is far more prevalent than strength. It has been the one constant. Central bankers declare their policies [...]
Nothing the Fed did today, or has done up to today, has changed the curves. Eurodollar futures and UST’s, they are both still inverted. The former sharply inverted. The only thing that has changed since early January is the narrative – and not in a charitable way. It is treated as a positive when it is a pretty visible signal [...]
The TIC data for December 2018 starts out well enough, exactly the way it should. The headline says foreigners sold a record amount of US$ assets in that month. Anyone paying attention during it would be the opposite of shocked. Everyone sold anything they could in December. It follows from the idea of dollar shortage. However, then you start asking [...]
In Japan, they call it “powerful monetary easing.” In practice, it is anything but. QQE with all its added letters is so authoritative that it is knocked sideways by the smallest of economic and financial breezes. If it truly worked the way it was supposed to, the Bank of Japan or any central bank would only need it for the [...]
For much of 2018, the idea of “overseas turmoil” lived up to its name. At least in economic terms. Market-wise, there was a lot domestically to draw anyone’s honest attention. Warnings were everywhere by the end of the year. And that was what has been at issue. Some said Europe and China are on their own, the US is cocooned [...]
China’s yuan just isn’t a stable currency. I don’t mean its exchange value, either. CNY floats up and down on the whims of the eurodollar. The PBOC can and does limit the daily trading band, but often at tremendous cost (ticking clock). Therefore, the internal constraint governing this dynamic is a symptom of a world that isn’t going to accept [...]
TIC update for December 2018. Given what happened in that particular month, yeah, this seems about right: Here’s the same thing smoothed out on a 6-month basis. Plus an added reminder. Just to refresh: That’s a shame because TIC will tell you so much more about the global economy and the changes taking place within it than the Establishment Survey [...]
It was late on a Friday night in early September 1997. Because his speech was given at Stanford University out in the Pacific Time Zone just as the weekend was about to commence, market watchers were bated with an almost frenzied anticipation. Alan Greenspan had come to be seen as more than just a monetary policy bureaucrat. He had conquered [...]
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