The FOMC met last week and did what everyone expected them to do - raised the Fed Funds rate by 0.75%. The bond and stock markets reacted not to this action but to the commentary provided by the committee in its statement and by Chairman Jerome Powell at his post meeting press conference. The former had a new phrase, a [...]
Forget a gradual decoupling from China. In October, the Biden administration announced new export controls and rules that effectively decapitate China’s semiconductor industry. The ramifications go beyond semiconductors to everything touched by them, including potentially ending nearly all of China’s high-tech aspirations. U.S. companies are now banned from exporting advanced chips to China without special exemptions. But the rules go [...]
Gregory (Scotland Yard detective): “Is there any other point to which you would wish to draw my attention?” Sherlock Holmes: “To the curious incident of the dog in the night-time.” Gregory: “The dog did nothing in the night-time.” Sherlock Holmes: “That was the curious incident.” From Silver Blaze by Arthur Conan Doyle, 1892 It is hard to determine sometimes what [...]
Ben Bernanke once admitted how the job of the post-truth “central banker” is to try to convince the market to do your work for you. What he didn’t say was that this was the only prayer officials had for any success. Because if the market ever decided that talk wasn’t enough, only real money in hand would do, everyone’d be [...]
Xi Jinping’s earlier “stimulus” promises had originally stimulated the Keynesian-addled imaginations of Western observers and Economists. Hearing only that single word, they didn’t appear much interested in any of its details. Like how Emperors facing increasingly grave difficulties historically tend to stimulate their own capacity for remaining Emperor above everything else.For a very brief moment, as Shanghai reopened, there were [...]
If the March gasoline/oil spike hit a weak global economy really hard and caused what more and more looks like a recessionary shock, a(n un)healthy part of it was the acceleration of Euro$ #5 concurrently rippling through the global reserve system. This much was apparent right from the start, with financial markets gone haywire three months ago (mid-March seasonal bottleneck), [...]
Neither Jay Powell nor Janet Yellen see recession risk. They’re coverage, though, ends at the US boundary, each thoroughly trained on the wrong idea the US economy is an island. While it isn’t and it has its own very visible recession problems right now, properly speaking globally there’s no bigger recession risk-ignition than over on the other side of the [...]
Rate hikes weren’t even a twinkle in Chairman Powell’s eye, not really. Taper was barely on the table at that time, let alone double-taper or today’s rush into QT. Back in October, they all (correctly) still used the word transitory, therefore officials were taking their sweet time winding down QE6.With the Fed barely evolving from full-on – so it couldn’t [...]
While the world fixated on the US CPI, it was other “inflation” data from across the Pacific that is telling the real economic story. Having conflated the former with a red-hot economy, the fact American consumer prices aren’t tied to the actual economic situation has been lost in the shuffle of the FOMC’s hawkishness, with markets obliged to price wrong-way [...]
They called it an atmospheric river, though I’m not really sure who “they” was nor whether the term is scientific or just media hype. Either way, in early November the Pacific Northwest of the US along with Western Canada was inundated by a, well, river of rainfall. Mudslides, torrential downpours, just a muddy mess across the entire region. At one [...]
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