Inflation in Europe was in July 2017 once again underwhelming. Eurostat’s HICP inflation index grew at a 1.3% annual rate for the second straight month. Other than for February 2017, the inflation rate has been less than the ECB’s 2% target for four and a half years. During that time, Europe’s central bank has vastly expanded its liquidity facilities (twice) [...]
The TIC data for May was inconsistent. It has been that way for several months, and importantly describes what I think is the operative “dollar” condition. Though the data is several months old already, we can tell by certain real-time prices and indications that the difference between 2016 and 2017 is very clear in some parts, and none in others. [...]
It is like a great many things forgotten now, but five years ago today the head of the ECB compared Europe to a bumblebee. That’s not quite right, however, as Mario Draghi really said the euro was like a bumblebee, but you’d be forgiven for mixing the two up. The purpose of his folksy analogy was so that Europe and [...]
Well, that clears that up. In case you missed it, back on June 27 Mario Draghi triggered the latest declared BOND ROUT!!! with what was characterized as a very upbeat economic assessment for Europe. And if things are moving forward there, they just have to be everywhere else. It came off as “hawkish” in the sense that if real acceleration [...]
US imports rose year-over-year for the seventh straight month, but like factory orders and other economic statistics there is a growing sense that the rebound will not go further. The total import of goods was up 9.3% in May 2017 as compared to May 2016, but growth rates have over the past five months remained constrained to around that same [...]
When it comes to central bank experimentation, Japan is always at the forefront. If something new is being done, Bank of Japan is where it happens. In May for the first time in human history, that central bank’s balance sheet passed the half quadrillion mark. It should be unsettling where a trillion is a rounding error. And yet, despite what [...]
The IMF like so many others appears to have been caught up in “reflation.” Its models had in its April 2017 WEO outlook upgraded US growth prospects for the first time in a long time. In their final 2016 WEO, the institute projected US real GDP growth of 2.20% for calendar year 2017, and then just 2.10% for calendar year [...]
Europe is as we all are. Ben Bernanke wrote a few years ago that his tenure at the Fed must have been a success in his view because the US economy didn’t perform as badly as Europe’s. As usual, this technically true comparison is for any meaningful purpose irrelevant. For one, the European economy underperformed before 2008, too. Second, after [...]
At the end of March, the European Central Bank (ECB) offered a second round of bank financing. Dubbed TLTRO’s, T for “targeted”, the program offered banks a chance to obtain direct funding for up to four years at an incredibly low rate. European banks in TLTRO2 were allowed up to as much as 30% of their outstanding eligible loan books [...]
US imports rose 9% year-over-year (NSA) in March 2017, after being flat in February and up 12% in January. For the quarter overall, imports rose 7.3%, a rate that is slightly more than the 2013-14 comparison. The difference, however, is simply the price of oil. Removing petroleum, imports rose instead 6.3% in March and just 4% for the first quarter [...]
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