Why was Janet Yellen’s speech yesterday so highly touted? My last post might be more relevant to that appearance than what is presented here. After all, each FOMC meeting begins with a presentation from the head of the Open Market Desk usually pertaining to comprehensive liquidity (or as much as the orthodox view of it allows). For all the smiles [...]
The theme since August 24 in wholesale funding, eurodollar and Asian “dollar”, has been that even the global and intense liquidation was not enough to square the mighty imbalance that has been building. It’s a frightening prospect, but in money markets everywhere that is the only interpretation left. The media, unable to make heads or tails, finds small nuggets of [...]
Durable goods continue to contract, with August down year-over-year in both shipments and orders now. New orders have been contracting since February (with January barely positive) at an almost steady rate near -3% the last few months, while shipments did not see a negative rate until May (and were slightly positive again in June). In capital goods, the pattern is [...]
By most accounts the Asian “dollar” was quiet last night but now the “regular” eurodollar is in full form. That might suggest greater care with these terms as the yen appears to be in that latter mix despite geographically belonging to the former. For purposes of clarification, then, since Japanese banks were among the original sources of the eurodollar buildup [...]
There is growing turmoil in buybacks that threatens the very fabric of the stock bubble. That was always the primary transmission of the foundation of its current manifestation, corporate debt, into asset prices; especially the huge run following QE3 and QE4. As represented by the S&P 500 Buyback Index, this liquidity propensity has found a durable reverse. After peaking all [...]
With back-to-school shopping falling apart, the focus turns quickly to the Christmas season once more. That is fully expected, lest anyone dwell too long on the August spending figures and begin to see through the “strong” economy. August retail sales – as expected – showed the effects of slow mall traffic and comparisons with very strong August results a year [...]
If for the Asian “dollar”, then China’s inability to place an economic bottom is a problem for every market and economy. The more hopeful mainstream rhetoric from the summer is now gone, just as the “dollar” would have it. China’s variations have far too closely matched these “dollar” waves which, in the midst of another, is not a hopeful sign [...]
The ISM for August was the lowest reading since the taper drama of 2013. At just 51.1, there isn’t any real basis for suggesting the manufacturing sector is even expanding (no matter what these sentiment surveys claim about that 50 dividing line). The “correct” interpretation is one which discards the exact figure for the relativism. For once, media commentary was [...]
As stocks selloff today, so too does the junk bubble. I think the implication traces back to the Asian “dollar” and the unsteady state of wholesale finance in that part of the eurodollar system (while contemplating the potential for mitosis to have occurred there at some point in the recent past, likely 2012). Junk prices not only remain depressed but [...]
Copper prices are getting pummeled this morning. Since copper is somewhat unique in its setting between wholesale finance and the real economy, but most especially what might fairly be termed the Asian dollar, it functions not just as a “dollar” proxy but perhaps more focused than that. We can assume by copper’s selloff today (the price for October futures delivery [...]
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