Trust the Fed. Ha! It’s one thing for money dealers to look upon Jay Powell’s stash of bank reserves with remarkable disdain, more immediately damning when effects of the same liquidity premiums in the real economy create serious frictions leaving the entire world exposed to the consequences. When all is said and done, the Federal Reserve has created its own [...]
Is there anyone left out there who doesn't know the rate of economic growth is slowing? The 10-year Treasury yield has fallen 45 basis points since peaking in mid-March. 10-year TIPS yields have fallen by the same amount and now reside below -1% again. Copper prices peaked a little later (early May), fell 16% at the recent low, and are [...]
Flash PMI’s for September 2020 around the world add more evidence to the possibility of a global slowdown during the economy’s all-important rebound quarter. Q2 was the big downturn, and so it always going to be Q3 where the bounce back would be sharpest. While that has definitely been the case, concerns are mounting for what might follow in Q4. [...]
It’s incredible, in a way, because right from the start he’s got everything on his side. There are the media write-ups which all say the exact same thing, calling this an exact science being practiced by the wisest, most considerate stewards. The legend we’ve been raised with. Lore and scholarship (I repeat myself). Most of all, everyone. When everyone says [...]
Despite what we’ve all been taught, and what gets reinforced in the media, it’s not really that difficult to get people to see the interest rate fallacy at least where it all starts. Central bankers say that low rates are stimulus when this runs contrary to every bit of historical experience as well as evidence. Yes, they are lying to [...]
The lack of issuance and supply over the last almost year or so, that’s what makes the TIC data so fascinating. And relevant, if for other reasons, too. CLO issuance, according to a bunch of sources, peaked back last June. Remember that whole “recession scare” with the yield curve last summer? It wasn’t just a scare, at least not in [...]
What connects March 2020 with February 2008 as well as the Crash of ’87 all then with the Great Contraction which initiated the Great Depression? If you said economic and financial chaos, you’d be partly right. There wasn’t really much or any of that in 1987, though there was with the other three. People including politicians and central bankers don’t [...]
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