The old adage is that strong and sustained economic growth cures many ills, if not all of them, so it is unsurprising that so many central banks would be so determined to create it. They are, surprisingly, limited in that endeavor as they always stop one step short of recognizing the shortfall. In other words, they will do everything (as [...]
On average, pig prices in China are about 50% higher to start this year than last. At about 25RMB per kg, prices are already above the seasonal surge that typically occurs during late summer. Last year, as pig prices started this huge run, wholesale pork jumped from a low of about 17RMB per kg at the start of April 2015 [...]
I think there is systemic significance in the relationship, including how it has evolved since early last year. It is, in my view, particularly relevant given where we are right now. More here (subscription required).
China’s official reported reserves rose in March for the first time in five months. Though reserves had fallen to barely $3.2 trillion in February, that was down just $28.6 billion from January, being already hailed as a success and a step in the right direction since that was less than a third of the shocking decline in January (-$99.5 billion). [...]
Not to continue beating a dead horse, but I have a stick and the carcass is right in front of me. The entire supply chain inside the US economy is full agreement both on where the economy is right now and, perhaps more importantly, how it came to be that way. Such harmony is not atypical, as synchronicity usually defines [...]
The risk budgets are again unchanged for this month. For the moderate risk investor, the allocation between risk assets and bonds remains at 40/60. The changes in our indicators this month were not significant enough to warrant a change. Credit spreads stopped narrowing and have recently been widening again, ever so slightly. Valuations, long term momentum and the yield curve [...]
In July last year, the BEA reconfigured its GDP benchmarks to incorporate the results of the comprehensive 2012 Economic Census. That broad and deep survey found much less “recovery” than the BEA had originally anticipated through its system of stochastic predictions. It is believed that these statistical agencies of the government actually measure results in the real economy but in [...]
The Wall Street Journal reported a few days ago (h/t ZeroHedge) on the status of the ongoing disruption in domestic production of long haul trucks and vehicles. In what can only be confirmation of the state of US manufacturing, the huge drop in orders for new trucks matches shippers’ perceptions of the actual economic flow in goods. While economists want [...]
It’s never a good sign when bank stocks are leading any retreat, but that is especially the case given recent events when several high profile banks were at the epicenter of early 2016’s liquidation rerun. As usual, Deutsche Bank and Credit Suisse are the firms most mentioned and among those most disfavored at these times. The media struggles to find [...]
Whenever the topic of recession comes up, the mainstream and especially economists (redundant) become quite defensive about the possibility. Just a few days ago, presidential candidate Donald Trump claimed the US was headed for “a very massive recession” and that it was “a terrible time right now.” The Washington Post, as you would expect, was skeptical of the claim because [...]
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