It has happened more frequently the past few days. The difference between the equivalent yield for the 6-month (26-week) Treasury bill and its cousin with a 1-year (52-week) maturity has turned negative. You have to watch for it intraday, catching it flipping occasionally back and forth by fractions. After hours more than regular trading.Inversion, in other words. That dirty term [...]
They really got carried away, though in the context of that time there seemed any number of legitimate reasons for this. Gold investors were bidding up the precious metal like there was some kind of shortage, the price in dollars making a new record high (LBMA morning fix) on August 7. The way it was reported in the mainstream, this [...]
One of the hardest things to understand as an investor is that markets sometimes - often - don't line up with economic reality. Markets rarely reflect current economic conditions and at times they seem to discount a future that seems highly unlikely at best, and delusional at worst. That seems to be the case today, as stocks sit near all-time [...]
On Monday, November, 9, pharma company Pfizer announced that in partnership with Germany’s BioNTech the pair had finally come up with the answer. The world infested with COVID could breathe easier safe in the knowledge a vaccine had been discovered, proven, and already close to approvals and production. “Today is a great day for science and humanity. The first set [...]
It’s been said that you can’t please everyone all the time. But can you fool enough people some of the time? That’s Jay Powell’s game in a nutshell. He’s got the world believing the Federal Reserve is out here printing gobs of money and sending a tidal wave careening throw the whole economy (stock market first). Nope. Monetary policy is [...]
Macroeconomic slack is such an easy, intuitive concept that only Economists and central bankers (same thing) could possibly mess it up. But mess it up they have. Spending years talking about a labor shortage, and getting the financial media to report this as fact, those at the Federal Reserve, in particular, pointed to this as proof QE and ZIRP had [...]
I’m not exactly sure how you translate the English word “hope” into Chinese, though Google’s translate algo tells me this is what it’d be: 希望. For the global economy to have any chance of just making next year less awful than it’s already predicted to be (by the optimists), the OECD declared China essential to the fanciful anticipation.As noted before, [...]
Sticking with our recent theme, a big part of what Inflation Hysteria #1 (2017-18) also had going for it was loosened restrictions for US oil producers. Seriously. Legacy of the 1970’s experience depending too much on OPEC, subject to embargoes, American oil companies had been prohibited for decades from exporting oil. Not that it would have mattered before 2014, the [...]
What had given Inflation Hysteria #1 its real punch had been the benchmark 10-year Treasury note. Throughout 2017, despite the unemployment rate in the US, globally synchronized growth being declared around the world (and being declared as some momentously significant development), and whatever other tiny factors acceding to the narrative, longer-term Treasury rates just weren’t buying it. Instead, the eurodollar [...]
It was only three years ago, so you’d think narratives today would at least try to account for relevant recent history. If that prior first fit of inflation hysteria had a birthdate, it would’ve probably been December 18 or 19, 2017. On the former, the US House of Representatives passed their version of the Tax Cuts and Jobs Act (TCJA); [...]
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