File it under “what were they thinking?” In March 2015, confronted by a severe external monetary squeeze, the PBOC made a truly radical choice. Maybe it was that for a few months anyway things looked a little better. The eurodollar system had practically melted down globally first on October 15, 2014 (collateral) and then in December 2014 and January 2015 [...]
The Asians are selling their Treasuries again, which can only mean one thing. The mainstream media will offer all sorts of explanations as to why that might be and not a single one will be correct. China and Japan are offloading US$ assets primarily federal government debt for vastly different reasons. Their decisions spring from the same source, but Japan’s [...]
The calendar last month hadn’t yet run out on US Industrial Production as it had for US Retail Sales. The hurricane interruption of 2017 for industry unlike consumer spending extended into last September. Therefore, the base comparison for 2018 is against that artificial low. As such, US IP rose by 5.1% year-over-year last month. That’s the largest gain since 2010. [...]
It was for a time a somewhat curious dilemma. When it rains it pours, they always say, and for China toward the end of 2015 it was a real cloudburst. The Chinese economy was slowing, dangerous deflation developing around an economy captured by an unseen anchor intent on causing havoc and destruction. At the same time, consumer prices were jumping [...]
The one thing the globally synchronized growth narrative had going for it was sentiment. It often had that in surplus. But therein lies a major drawback; are people happy because things are getting better, or do they believe things are getting better because “everyone” says so? There’s a difference and it’s a big one. And it may not matter much [...]
Whether or not any central banker chooses to appreciate the fact, money is an important economic tool. Before it ever gets to be a store of value, there has to be some correct supply so as to become a medium of exchange (and almost by virtue a unit of account). The problem throughout history has been to foresee and then [...]
There was an old joke among bond investors that use to say no AAA-rated bond had ever defaulted…because it was downgraded several times first. By the time the issuer was in restructuring, it was junk accredited long before then. It ceased being funny around February 2007. There is something similar and similarly tragic that takes place in the wider macro [...]
It’s one of those useless explanations that while technically true tells us nothing of value about the situation. The Chinese are never boring when coming back from a Golden Week holiday. This weekend was no exception, China’s reopening bringing with it the news of yet another cut in that country’s bank reserve requirement ratio (RRR). Following two already, one for [...]
The year 2012 was a turning point, there can be no doubts about that. At least not when objectively and honestly reviewing the data. Up until the worldwide slowdown that hit that year, starting the year before, 2011, in an “unexpected” flareup of global monetary crisis, the Great “Recession” was viewed as harsh, even prolonged. But in the end everyone [...]
On March 9, 2007, Rhode Island Representative Patrick Kennedy introduced HR 1424. At the time it was to be known as the Paul Wellstone Mental Health and Addiction Equity Act of 2007. The bill contained five small sections intending to ensure equal coverage and treatment for mental health issues under insurance claims. It passed the House but then gained an [...]
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