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A Good Time For Some Q & A: Bank Reserves, Treasury Auctions, MMT, and the Monetary Resolve

By |2020-09-23T18:24:58-04:00September 23rd, 2020|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets, Stocks|

Working with my colleague Joe Calhoun (mostly him), we’ve come up with what we think is a list of questions that quite naturally arise from this week’s discussions of bank reserves, some specific and technical, the monetary system, some theoretical, some practical, and the (much) wider economic consequences which follow from those. 1. When the bank buys a Treasury note/bond/bill [...]

Reopening Inertia, Asian Dollar Style (Still Waiting On The Crash)

By |2020-09-17T20:03:37-04:00September 17th, 2020|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

Why are there still outstanding dollar swap balances? It is the middle of September, for cryin’ out loud, and the Federal Reserve reports $52.3 billion remains on its books as of yesterday. Six months after Jay Powell conducted what he called a “flood”, with every financial media outlet reporting as fact this stream of digital dollars into every corner of [...]

Xi Has Upped His (Ruthless) Game; Dollar Scarcity, Chinese Economy, and the World Surrounding All of It

By |2020-08-25T19:19:03-04:00August 25th, 2020|Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

There’s one key piece of the “petroyuan” story which has gotten lost in the frenzied hype. While many get fixated, and make others fixate, on how RMB-for-oil was going to, or maybe even still will, destroy the dollar there’s been important, legitimate functions for Shanghai’s International Exchange which don’t involve, and never really did, replacing the reserve currency. It’s all [...]

Not This Again: Time For Petroyuan Revisit

By |2020-08-20T19:54:15-04:00August 20th, 2020|Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

Does anyone remember the petroyuan? It doesn’t appear so, though not because the thing disappeared rather due to the fact that it didn’t. It was a really big deal for a time, pretty much all of 2018. What it was supposed to have represented was the dollar’s death knell. Guaranteed, one hundred, no, one thousand percent dead. This was widely [...]

Part 1 of June TIC: The Dollar What

By |2020-08-18T18:35:06-04:00August 18th, 2020|Markets|

While the world is taking the smallest of baby steps in the right direction, mostly it’s been related to the part of the eurodollar system that everyone can see. Not bank reserves and the Fed’s “money printing”, though you can see them and we’re told to obsess about them those things don’t matter. I mean instead the dollar’s exchange value; [...]

Inflation Hysteria 2, China Style

By |2020-08-14T20:03:49-04:00August 14th, 2020|Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

Forget scripted television. If you want Game of Thrones-style palace intrigue, you can do no better than Beijing in 2020. There are all sorts of rumors floating around, few of which can ever get confirmed. It’s not that there are rumors but rather how many of them, and how they don’t seem to be stamped out with the usual regularity [...]

What’s In The Same Number? China’s Part In The (euro)Dollar Story

By |2020-08-04T19:26:42-04:00August 4th, 2020|Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

There’s one part of the dollar story I’ve not yet touched on recently. We’ve already heard, too much, about how the Fed’s killing the dollar, or at least is aiming to with all its immense money printing fire power. While it’s the euro which has demanded so much from DXY that it almost seems plausible (to a few) this time, [...]

More To Being De-dollared

By |2020-07-21T19:04:15-04:00July 21st, 2020|Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

It’s understandable to an extent. Central banks are omnipotent, central bankers therefore the nearest human equivalent of gods. That’s what we’re all taught, so if something happens somewhere to some market then we’re left to believe it was because one of the gods wanted it that way.Taking this globally, the Fed made a bunch of money in the aftermath of [...]

Huge, Massive Difference: De-dollarizing vs. Being De-dollared

By |2020-07-20T17:56:40-04:00July 20th, 2020|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

There is a tremendous difference between the world de-dollarizing and those living in it being de-dollared. The former is a choice, the latter a fact of existence since August of 2007 (to varying degrees). Yet, most people, especially the “experts”, talk of only the first one as if that was all there is to it.Especially when it comes to China.We [...]

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