Unsure what to make of the renewed disaster in Chinese trade figures, there has been renewed emphasis on China being China. Almost every media story about the 20% collapse in imports references an assumed attempt by China to transform out of exports and into a consumer-driven economy without reconciling how or why that has so obviously and spectacularly failed. Nor [...]
After a relief rally, risk assets are at a critical juncture. We may be seeing a bottoming in global risk assets and hopefully another up-leg in the current expansion. But pessimism and risk aversion are high. We will need to see better economic news to alleviate the fears that higher interest rates will push us into recession. The popping of [...]
You wouldn’t know it from stock trading or commodities, but when China reopened after its latest Golden Week holiday there was an obvious effect. Stocks have continued to surge while commodities overall have had a good week (copper up another $0.07 today, with WTI at about $50). Inside the money markets, however, China’s open was met with far less enthusiasm, [...]
Even a quick glance at recent t-bill rates commands further attention. There is obviously a lot going on in the bills market just in the past few months, which may only be unexpected in the sense that there isn’t a plain connection between US government bills and the fireworks elsewhere. T-bills used to be, however, the primary source of repo [...]
It has certainly been much calmer in October so far, especially compared with the deep deviations following the FOMC’s lack of activity. Stocks have rallied since October 1 along with many commodities, especially crude. Currencies have been almost mellow, with the ruble following oil prices upward, the real departing (for now) from its devastation and even those like the Indian [...]
The Census Bureau updated US trade activity for August, with export activity dropping almost 11% year-over-year. The global economy is clearly falling apart, no matter how much economists wish to see the dollar (exchange rate fluctuations) where the “dollar” (wholesale finance pulling back leading to economic disarray) already is. Export activity is only a little short of the trough of [...]
On September 28, Mark Haefele, Global CIO at UBS Wealth Management, wrote at CNBC.com there was much more to the central banking offerings than currently employed. The implication, obviously, was a reassuring call to not heed any darkening outlook. Blaming that upon “overanalyzed data”, Mr. Haefele insisted that investors were becoming far too pessimistic given the potential monetarism yet untapped. [...]
Concurrent to more survey-based indications of a US manufacturing slowdown, economists have been quick to blame overseas problems such that it leaves a “strong” US economy as a baseline. On the other side of that equation, China’s manufacturing likewise is rapidly declining but somehow with the same point of blame. Both Chinese PMI’s were decidedly weak, with the private version [...]
While the slide in US manufacturing is being interpreted far differently as nothing to worry about, overseas the recessionary implications are forthrightly described. The contradiction is amazing simply because the same pattern is given such different interpretation even where they are closely synchronized and both given amorphous “global” growth connotations. In Japan, contraction in industry due to “global growth” is [...]
Before embarking on the great unknown of Q4 2015, it makes sense to try to gain a little more clarity about Q3 2015. Specifically, the “dollar” run that blasted through China and opened the prospects for both an end to Fed/Yellen faithfulness and increasing uncertainty about the true nature of economy and finance globally began around July 6; a day [...]
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