In some ways, President Obama’s leaked contempt for the “strong dollar” is well-deserved if only due to the mistakes about the semantics of it. Maybe I am being overly pedantic in decrying this taxonomy, but since we live in an economic age of high and burdensome redefinition this is more than just a debate for academic affairs to me. The [...]
It is exceedingly difficult these days to detect where finance ends and the economy begins. That was intended, of course, as it was believed that greater intrusiveness on the part of the financial ends were consistent with greater, and better, economic control. Certain strains of economics have been obsessed since the dawn of the discipline with finding “optimal” outcomes. More [...]
Part 1 is here, Orderly or Not (short version: not). Also noted yesterday, the Fed sees no risks of bubble trouble because they are looking at it all from the 2008 perspective. That is completely wrong-headed; if there is a “next one” it will have nothing to do with subprime mortgages, or even mortgages and real estate. By March 2007, [...]
I generally remain noncommittal about giving specific predictions about the future because there is simply no way toward predilection. We can think about probabilities as a guide for analysis, particularly in setting investment guidelines, but to offer targets for factors like GDP or some stock index is pointless. Even now, with all that is taking place of economic unraveling, there [...]
When looking toward what might be coming next from the FOMC, the reigning theme remains “they don’t know what they are doing.” That sentiment applies, of course, retroactively to all the QE’s, Twists and badly implemented emergency measures on the way down, but attention is rightfully focused now on how to get to C. Going from A to B already, [...]
In the age of ZIRP it can be difficult to gain perspective especially about interest rate movements. Trying to analyze the ups and downs including any relevance or importance is clouded by the lack of historical clarity on that account. We really have no idea about the true significance of scales at and near the zero lower bound because this [...]
Some people are getting very nervous about China, and as usual that stems from a misreading of the Chinese intentions. This is not to say that one should not be concerned at all, but it is much better to be concerned for the right reasons in order to find a more suitable line of inquiry and analysis. The complications of [...]
Given the dramatic inflection in “dollar” behavior surrounding the March 18 FOMC meeting there wasn’t much surprising in the latest TIC figures for that month. If anything was complicated it was due solely to the fact that this change occurred mid-month. For the most part, the heavy “tightening” trend that began anew after January was reset by the end of [...]
The conventional wisdom last year as it related to the “dollar” was that its ascent had to be confirmation of the divergence between US economic fortune and the continued and even growth misfortune of the rest of the world. That is pretty much standard orthodoxy as it seeks to align financialism with a generic view of the economy. On its [...]
The FOMC statement changes seem to have initiated knee-jerk reactions undoing the interpretations of the March statement. In other words, the first blush of FOMC obfuscation appears to be trending back toward “hawkishness” in clear defiance of last month’s clear “dovishness.” The basis for that seems to be the references to what the Fed is still proclaiming “transitory” factors, to [...]
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