We have been talking about a global “dollar” run for the better part of two weeks, and at least a major “dollar” disruption looming going back three months. To say that any of the latest chaos is “unexpected” is intentionally obtuse, but it has already happened. As it is, I think we can expect FRBNY and the Treasury to issue [...]
Has the much-anticipated correction finally arrived? After trading within a range of 150 or so points, the S&P 500 Index (IVV) just fell off a cliff in the last week, decisively breaking the 200-day moving average as well as the psychologically important 2000 level. The S&P 500 is now down 2.89% year-to-date. The EMU Index ((EZU)), or the European Economic [...]
Why was the stock market down almost 6% last week? I know what you're thinking - has this guy been under a rock somewhere? But I'm serious. I know what all the pundits, commentators and talking heads are saying about the immediate cause. It's about the China devaluation and the knock on effect in other emerging markets. It's about global [...]
The volatility and negative price movement in capital markets this week is a symptom of a money system void of principle. The morally bankrupt system ignores the demand for money and just supplies it at continually cheaper levels. Unfortunately, the recipients of the cheap money are not inclined to use it for productive purposes. Idle cash, disruptive capital flows, and the [...]
Top News Headlines Stocks succumb to gravity. Industrials join transports in official correction, down over 10%. S&P down almost 8%. Emerging markets enter the bear's lair, down 25% from recent highs. Oil cracks the $40 barrier - to the downside. Tensions high on the Korean Peninsula. Americans foil terror attack on French train. Kazakhstan devalues the Tenge. Yes, that's a [...]
Stocks aren’t quite as immune to financial disruption in the middle of 2015 as they had been previously. The last major, comprehensive selloff was also in tandem with “dollar” disorder back last October 15. This time, the motion was more erosion than “event”; at least until the past week. Just like crude oil, stocks lost their momentum back in early [...]
Three-month LIBOR has just this month risen by a little more than 3 bps. That sounds like nothing more than a rounding error, beyond trivial, but considering it had only risen 3 bps prior going back to March the comparison of acceleration is what clearly matters. Up until August, the upward variability in LIBOR had been limited toward the longer [...]
Just a couple of noteworthy prices/developments around the close: 1. Repo rates have come back down, with the GC rates yesterday below IOER for the first time in 16 trading sessions (MBS). Volume in MBS has been quite light recently, with UST volume making up the difference. I can’t see any particular reason for such a marginal shift except the [...]
It was another very heavy intervention in yuan last night for the PBOC, making that twice in just one week. The activity is so fierce as to be of similar proportions to the very tight Chinese New Year period, meaning that it is an understatement to say that the PBOC is under great strain. What is less defined, especially in [...]
June was the for-sure liftoff point early in the year. That followed last year’s for-sure exit as March, April at the latest. Now more than a halfway through 2015 September is increasingly in doubt. They have to start somewhere even if they claim a methodical and slow pace to ensure as little disruption (in their twisted view). As I wrote [...]
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