In December 2006, just weeks before the outbreak of “unforeseen” crisis, then-Federal Reserve Chairman Ben Bernanke discussed the breathtaking advance of China’s economy. He was in Beijing for a monetary conference, and the unofficial theme of his speech, as I read it, was “you can do better.” While economic gains were substantial, he said, they were uneven. To keep China [...]
Here they come. After spending more than a year talking about nothing but good things ahead for the global economy, Economists are beginning to sound worried. In 2017, there wasn’t anything that could stand in the way of synchronized growth. In 2018, there’s no longer any synchronized growth, so now we can talk about what was standing in the way. [...]
For the first half of the Great “Recession”, China and the rest of the EM world seemed immune. It was American subprime mortgages that we were told was causing all the problems, and if European banks had somehow gotten themselves entangled in the rotten real estate mess so much the better for where growth was invulnerable. This first instance of [...]
You get the impression often that these guys have no idea what drives the dollar. They cling to all sorts of theories, of course, from interest rate differentials to perceptions of economic strength. That seemed to be the case in 2017 and its “weak dollar” environment. Globally synchronized growth would mean potency pretty much everywhere, thus, in this view, a [...]
On November 7, 1973, President Richard Nixon addressed the nation via a broadcast television appearance. The topic wasn’t what you might think. Rather than trying to reassure Americans about the unfolding Watergate scandal, Nixon instead attempted to encourage the country about its energy situation. The month before, Egypt and Syria had launched a surprise attack against Israel. Arab members of [...]
It’s hard to believe it was only about three months ago. Time flies when disaster unfolds all around you. In early June, Brazil’s central bank arranged a press conference where its President Ilan Goldfajn would set everyone straight. The currency was falling, he admitted, but it would be easily handled by closely following the Portuguese version of the global central [...]
Why is SHIBOR falling from an economic perspective? Simple again. China’s growth both on its own and as a reflection of actual global growth has stalled. And in a dynamic, non-linear world stalled equals trouble. Going all the way back to early 2017, there’s been no acceleration (and more than a little deceleration). The reflation economy got started in 2016 [...]
If we are in the red on global eurodollar money, it makes sense to ask the question where we are in terms of global economy. What I mean by that is in the context of these repeating cycles. The world starts out enthralled by central bank or government actions when these usually come only after the ultimate depths of the [...]
The opening shots of the so-called trade war have actually been very kind. It’s the sort of stuff Keynesian Economists live for. Activity has been accelerated across a broad front. US imports moved first and now perhaps US exports are in on it, according to the latest Census Bureau estimates. To begin with, the import side. Inbound trade rose 8% [...]
IHS Markit reported last week that its composite Purchasing Managers Index (PMI) rebounded slightly in its first reading for June 2018. In January, the index had managed nearly 59, the highest in a very long time. It was taken as a definitive sign that Europe’s economy was not only booming, that boom was sustainable. Global liquidations struck at the end [...]
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