The Greek drama seems to have reached somewhat of a boundary, with deadlines and credit assistance drawing toward maximums. If this seems more than a little déjà vu that’s because it is an almost exact replay of 2012; all that is missing at this point is another default (debt swap or however it shall be classified). Greek banks have been [...]
There was a reason FDR’s administration in its first 100 days took the order it did. Contrary to some assertions, Executive Order 6102 was not a lawless expansion of executive privilege and prerogative. It had a very lawful basis, underwritten by the Emergency Banking Act of 1933 which itself was based on (and no part of this fact should be [...]
The unifying element of the prospect for recession in 2015 is how it will reveal the hugely mistaken assumptions that were taken on faith alone. Entering 2008, for example, the FOMC kept some plausibility because of the housing debacle. A convenient scapegoat, the Fed proclaimed that recession was a danger on housing alone, and so its mistakes were met as [...]
With the preliminary release of the quarterly GDP revision comes the BEA’s version of corporate profits. This is obviously different from EPS accounting that goes along with stock indices and various earnings growth measures as this macro view of profits encompasses a much larger business spectrum (though it does not include non-corporate business which is a pass-through component into personal [...]
The emphasis of QE in terms of “portfolio effects” and interest rate “stimulus” is to visit upon the entire curve what monetary policy has done in the past in only the shorter maturities. So the evolution of monetarism under activism and interest rate targeting is to bring the entire curve down whereas before it was content to intrude only in [...]
For the longest time, Jupiter was never thought to play much of a role in celestial mechanics of the much smaller scales in the solar system. Comets and asteroids may not seem to be significant to solar reality, but to those of us that reside on Earth there is much to appreciate about even planetary gravity and the survival of [...]
One of the curiosities of the commodity collapse since the end of last June has been how various financial derivatives have been thrown off. I’m not speaking of credit default swaps of small businesses that provide sand to fracking rigs or “products” like that, but something far more basic. The price of commodities should, you might think, provide a basis [...]
It seems everyone was short the franc (CHF) as a matter of taking monetarism at face value. In other words, it amounted to believing the central party line about the economy and normalcy despite the fact that markets have been increasingly pessimistic about it all and actively and aggressively betting against it. Goldman Sachs is just one of many: In [...]
For months now, really going back to the summer, the obvious decline in Chinese economic function has produced a resounding expectation that the PBOC would come to the rescue. It was taken axiomatically such was this Pavlovian reflex. Everything the PBOC did over the summer was characterized in that context: the introduction of the PSL and its implementation largely with [...]
It has been lost to history now, but the first stirring of rational expectations theory was something like daylight savings time. “Experts” posited that there could be calendar effects lurking in behavior that might be exploited with the right kind of regulatory agenda and even interference in something so established as Thanksgiving itself. As Pat Horan at RealClearHistory details, FDR [...]
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