The “dollar” has ended the month much the way it started. Despite headlines suggesting the dollar is “down” today, it is very much proving to be disruptive across every proxy. Gold was down to $1,080 at the AM fix before rebounding. Commodities were sold broadly, with copper back near $2.359, down almost $0.02 at some parts of the futures curve; [...]
According to the latest GDP revisions I may have been off in my projection of where the recession began. I wrote in 2013 that if pressed I would name October 2012 as the start of the recession. There were many reasons for that assessment; retail sales suddenly and sharply slowing, durable goods and particularly capital goods orders contracting and a [...]
For once, the Fed gets it right. Actually, it is three times and only certain parts of the Fed, as the agency is by no means monolithic. In the first two, the Atlanta Fed’s GDPNow tracker nailed the preliminary GDP estimate for the second straight quarter. You can appreciate why they unveiled it just recently despite it’s existence going back [...]
The simple narrative about QE is drawn from what is believed a simple process. The central bank buys bonds and by doing so it is simply assumed to be an “extra” bid on bond prices; therefore interest rates fall in whatever issue is being targeted by QE. Even in the US, QE has had trouble with that simple relationship. Instead [...]
Despite being the last FOMC meeting before the ever-expected rate hike in September , there was a whole bunch of nothing in markets before and even after the policy statement. Even the typical knee-jerk was less than on prior meetings. Maybe traders have come to expect so very little from the policy statement, focusing more on the inanities and silliness [...]
I typically stay away from sentiment indicators and measures of “confidence” not just because they are of dubious construction but they often don’t mean what they are taken for. In the case of consumer confidence, you get both problems simultaneously particularly at the ends of each cycle. In other words, just as “confidence” is at its greatest point and economists, [...]
The housing market has failed to perform as expected on either side. Instead, as far as a broader set of measures, real estate is in a bit of stasis, neither really growing nor falling apart. Given the set of mainstream economic expectations, that is confounding and could ultimately be a problem. If the economy is really growing, it should be [...]
With the advance report on GDP for Q2 set to be released this week, economists are working hard to explain why it doesn’t represent the utopian delivery that they swear had already occurred via monetary intervention. There is, in immediate terms, the universal appearance of “residual seasonality” in the past few months as an almost complete revulsion to even the [...]
It will be a few more days before the major banks release their quarterly balance sheet figures for Q2. We already know from their earnings reports that money dealing is no longer much of a high priority for global banks, as it is, quite simply, no longer profitable. Commentary still dwells on that as a matter of Dodd-Frank, Basel III [...]
The “dollar” problems continued this morning as several proxies continued toward new lows. Copper fell to as low as $2.342 (July contract still) while crude is down close to $47 in the front months. The back end of the WTI curve, perhaps more importantly with respect to growth and fundamentals tied to the “dollar”, fell to new lows. The Brazilian [...]
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