I was going to write that there was bad news out of Japan last night, but is there really any other kind? I know that from time to time Japan’s various rebounds over the years are characterized as the greatest economic achievements in human history, but by and large very few outside the media actually believe that. Thus, there is [...]
June was a good month for Japanese workers. Real wages rose at the fastest pace in eight years, jumping nearly 3% for the first time since 2010. The data, reported by the Japanese Ministry of Health, Labor, and Welfare, was the first piece of positive economic news in some time. As you might expect, the wage figures are being taken [...]
The risk budget is unchanged again this month. For the moderate risk investor, the allocation between bonds and risk assets is evenly split. The only change to the portfolio is the one I wrote about last week, an exchange of TIP for SHY. Interest rates are on the rise again, the 10-year Treasury yield punching through 3% again this morning. [...]
The Bank of Japan is run by clowns. All of their major moves have blown up in their faces. The NIRP fiasco of January 2016 was one of the most stupendous moments of technical ineptitude ever displayed by a central bank; and that’s saying something, being able to choose from such a long and prominent list of monetary policy errors. [...]
The Russian ruble has fared far and away much better than its EM peers. Compared to something like the Brazilian real, there is no comparison. The ruble has been relatively steady following an initial drop in April with the imposition of sanctions. April 19 came and went, and while that date is displayed prominently across all the key currencies it [...]
CNY has held up over the last few days after Chinese officials intervened. Central bank actions like these tend to work if only over the very shortest timeframes. The tentative calm there, however, hasn’t extended universally. Copper, for one, has fallen right out of its Reflation #3 range. Selling off solidly for almost a month now, today it was pounded [...]
There are several factors missing from the latest eurodollar rout. Well, not really missing so much as sitting this one out to this point in time. We knew things were really getting serious in 2015 when the Japanese yen joined the currency parade. Only it didn’t fall as others had, JPY rather rose very much against the Bank of Japan. [...]
Some things are not supposed to be innovative. It’s no surprise that given the high technology of our modern lives that modern humans tend to be drawn to the new and shiny. We’ve marked the advance of society along the lines of big leaps in understanding and doing. Quite easily, we can get lost equating the two, thinking every innovation [...]
If it seemed a bit calmer yesterday in global markets than has become typical, it was likely due to the absence of Chinese influence. China’s markets were closed for the country’s annual Dragon Boat festival, a holiday tradition that supposedly dates back 2,000 years. According to state media, it’s not strictly Chinese any longer. The celebrations have apparently spread all [...]
The Bank of Japan gathered its policymaking members in Tokyo at the end of last week. The statements released and the commentary given pursuant to it exuded a renewed darkness. When they had last met on April 26 and 27, things were already different. But the conclave before that, March 8 and 9, they were practically giddy. What a difference [...]
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