The Fed has many problems with its attempt to convince the world that it has itself fulfilled its recovery mission. That self-reflected “mandate” is meant to include a masterful revisit to prior American infatuation with debt and credit. There was no more visible and visceral demonstration of those terms than the middle 2000’s, and it is the intent of monetary [...]
Following up from yesterday’s nod toward monetary policy irrationality, the “relevant” markets today continue to profess their concurrence with it all categorized in that manner. I’m not just critiquing the readings of economists at the Fed and their conditional responses, I’m stating unequivocally that the entire affair, and all in it, has been reduced to pure farce. That starts squarely [...]
The federal funds rate holds no relevance to anything actually useful and meaningful. That has been the case for some time, though pinning down exactly when federal funds became irrelevant is a bit of chore (I personally view it when altering Regulation M in 1990 created a regulatory par with eurodollars). Even the FOMC admits how actual finance has passed [...]
Since October 15, gold, yen and Swiss francs have all been pummeled by what increasingly looks like a “dollar” repeat from the start of Q3. It is difficult to suggest whether there is any shift in safe haven bid in all three, but I would guess, as with Q3, it may not have mattered as the “dollar” function globally has [...]
The poor and impoverished state of the world is no true wonder given those that have claimed for themselves the “duty” of exceedingly routine disruption and wholesale distrust of markets in favor of their own very narrow interests and abilities. These are the people that give us such incompetence passing as expert and "useful" central planning: https://twitter.com/mattyglesias/status/666301870521102336?ref_src=twsrc%5Etfw Nothing like another [...]
US industrial production contracted again in October, having declined now in seven out of 2015’s ten months. Year-over-year, US IP increased by the smallest amount since 2009, barely positive at just +0.34%. The last time IP was so slow was January 2010; on the way down into the Great Recession, it was equivalent to March 2008. Capacity utilization declined again [...]
Dealer banks are accomplishing their withdrawal from FICC and the eurodollar necessities of dark leverage in the typical corporate fashion. For one, there is attrition as past derivatives trades simply runoff or mature. Second, banks have been engaging in what are called compression trades to an enormous degree, the money dealing equivalent of synergy. Finally, dealers have been studious and [...]
Economics is a not a science. It tends to emulate the appearances by which outwardly hard sciences project in terms of rules and especially mathematical complications, but it does not conform. Karl Popper observed in 1972 that, “Whenever a theory appears to you as the only possible one, take this as a sign that you have neither understood the theory [...]
The overnight rate in offshore renminbi liquidity surged over 4% today, the fifth such notable heave in this half of 2015. The rate had been under 2% for the six trading days before and including Friday, but overnight CNH HIBOR jumped from 1.7325% to 4.4525% over the weekend. The one-week maturity similarly spiked, moving from 2.796% at the end of [...]
Japan fell back into recession again in Q3, expected this time, which is actually being charitable to Abenomics and especially QQE. To even believe that this monetary insanity has produced even marginal benefits, it has to be given “credit” of at least mini-recoveries in between these “technical recessions.” It is a problem far worse than that, as even a technical [...]
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