japan

Japan’s Bellwether On Nasty #4

By |2019-06-21T17:01:43-04:00June 21st, 2019|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

One reason why Japanese bond yields are approaching records like their German counterparts is the global economy indicated in Japan’s economic accounts. As in Germany, Japan is an outward facing system. It relies on the concept of global growth for marginal changes. Therefore, if the global economy is coming up short, we’d see it in Japan first and maybe best. [...]

TIC Reveals The Landmine; This Time Is Already Different

By |2019-06-18T16:51:41-04:00June 18th, 2019|Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

I’ve been writing since October when China reopened from that month’s Golden Week holiday that big dollar problems were imminent. You needn’t have taken my word for it, the PBOC said as much. Not directly, of course, but in interpreting the central bank’s anticipated behavior left little doubt.  Over the next few months, more and more it seemed as if [...]

Japan’s Surprise Positive Is A Huge Minus

By |2019-05-20T12:47:46-04:00May 20th, 2019|Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

Preliminary estimates show that Japanese GDP surprised to the upside by a significant amount. According to Japan’s Cabinet Office, Real GDP expanded by 0.5% (seasonally-adjusted) in the first quarter of 2019 from the last quarter of 2018. That’s an annual rate of +2.1%. Most analysts had been expecting around a 0.2% contraction, which would’ve been the third quarterly minus out [...]

Effective Recession First In Japan?

By |2019-05-14T17:43:46-04:00May 14th, 2019|Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

For a lot of people, a recession is two consecutive quarters of negative GDP. This is called the technical definition in the mainstream and financial media. While this specific pattern can indicate a change in the business cycle, it’s really only one narrow case. Recessions are not just tied to GDP. In the US, the Economists who make the determination [...]

CNY, Its Doom Sisters, And Chinese Threats

By |2019-05-13T16:31:59-04:00May 13th, 2019|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

It’s a tell-tale sign of someone who doesn’t know what they are talking about. In the realm of global currency systems, anyone who brings up China’s massive stockpile of US Treasury assets inevitably they assign all the power to the Chinese. Xi could destroy Trump if he wanted, bringing down the US in a righteous fit of trade war anger. [...]

What Tokyo Eurodollar Redistribution Really Means For ‘Green Shoots’

By |2019-04-29T12:04:38-04:00April 29th, 2019|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

Last April, monetary officials in Japan were publicly contemplating ending asset purchases under QQE. This April, they are more quietly wondering what other financial assets they might have to buy just to keep it all going a little longer. I’d suggest something like the clouds passing over the islands or the ocean water surrounding them. Nobody would notice either way [...]

PMI Eruption

By |2019-04-18T16:58:55-04:00April 18th, 2019|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

As noted yesterday, what’s typically behind these hopes about “green shoots” is a central bank, more often than not more than one central bank. In 2019, the Fed’s pause isn’t the only supposed dovish turn. The ECB is back at it, having canceled its rate liftoff. And the PBOC is doing things that nobody ever cares that much to truly [...]

The Forced Exile Of Bond Vigilantes

By |2019-04-08T15:40:25-04:00April 8th, 2019|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

Japan is the very model of fiscal irresponsibility. If ever there was a bond vigilante, surely they would have a Japanese address. At the end of what was the Bank of Japan’s 133rd fiscal year, on March 31, 2018, Japan’s central bank reported total assets of ¥528,285,679,854,140. Of which, ¥448,326,107,324,120 was Japanese government bonds (JGB). Officials became increasingly confident these [...]

Euro$ #4 Calls Off The Bond Rout, Even Though It Means Fiscal Situations Likely To Grow Worse Still

By |2019-04-05T16:36:03-04:00April 5th, 2019|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

Critics of government debt, a group which really should include every taxpayer, like to point out how governments prefer to pay back that debt with hugely inflated currency. You don’t pay it off so much as inflate it away. Change the convertibility number for your local currency and, voila, a much more manageable credit profile emerges. Only, there are often [...]

Same Planet, Very Different Worlds

By |2019-03-25T19:07:45-04:00March 25th, 2019|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets, Stocks|

This is really getting out of hand. For the fourth day in a row, unofficially, effective federal funds or EFF remains above IOER. At the same, now the 10-year UST yields less. What was last week pretty concerning stuff before the Fed’s capitulation is this week whatever category lies below. This is not a resumption of the bond bull market. [...]

Go to Top