When the Bank of Japan announced on October 31, 2014, that it would increase the scale of QQE to ¥80 trillion annually, it noted the usual surfeit words that have clearly been passed around to everyone within network connectivity of the central axis of orthodox economics. You can honestly close your eyes and have someone read aloud the text and [...]
If on the fence trying to decide whether surging job openings or tailing hiring is the true representation of the economy (recognizing that these are not mutually exclusive propositions, just that it isn’t very likely they both coexist in anything but subjectively statistical fancy) Gallup just offered far more of the latter. Should actual job openings hold some kind of [...]
Typically when any statistic gets way out ahead of itself it will eventually revert toward its prior state. That is the nature of stochastic modeling in economic accounts and it presents a great weakness. It is not unshared, however, as that is nothing more than recency bias applied to a quite dynamic world. The great flaw in any stochastic model [...]
The risk budget this month is unchanged. For the moderate risk investor, the allocation between risk assets and bonds remains at a defensive 40/60 versus the benchmark of 60/40. Credit spreads continued to widen over the last month but the rate of change is still orderly. The change this month was not sufficient to trigger an additional sell signal. Valuations [...]
The update to the S&P/LSTA Leveraged Loan Index was pretty much as expected following the interpretations I suggested Friday. Despite the alleviation of direct “dollar” pressure on liquidity subtracting from asset prices, there is a very distinct lack of enthusiasm to, at this point, rebid for margined assets or to pick up “bargains.” The index itself rebounded from a low [...]
In a world saturated by derivatives, the concept of a bellwether of a bellwether might actually make sense. If China is one for the global economy then perhaps South Korea might be it for China. Unlike Japan, South Korea hasn’t had the yawning chasm of QQE to alter its balances, therefore the level of shipments particularly to China offer perhaps [...]
I understand the conceptions very well, as the dominant economic theory is something like “no pain, no gain.” In the words of many central bankers, almost in unison of not just intention but tone and even exact phrasing, there are costs to getting the economy moving forward. In Bernanke’s version, savers are to sacrifice in favor of financial redistribution that [...]
The S&P 500 Cap-Weighted Index ((IVV)) held support at the 1900 level (at least temporarily) after its crushing meltdown from the 2130 level over the last month. If the index manages to hold here, we may test resistance at the 50-week moving average, which was once strong support. If it doesn't hold the 1900 level, we are looking at the [...]
That's the question everyone is asking these days. Will the Fed go ahead and raise interest rates at their next meeting? Or is the economy still so soft they don't dare derail what recovery we've managed to attain? Was last week's employment report good enough to keep the Fed on track to do what they seem to think they need [...]
Top News Headlines Migrant crisis grips Europe. China finds a way to stop market from falling; trading suspended for parade. US stocks resume slide, down 3.4% for the week. ECB contemplates new round of QE. Markets shrug. Economic News Mixed employment report confuses rate hike calculus. Manufacturing still weak. Chicago PMI, Dallas Fed survey, ISM manufacturing all less than expected. [...]
Stay In Touch