Stodgy and mundane, the very model of prudence and wisdom. That is what central banks are supposed to be, even in this new age transparency paradigm. The central bank being put on display for the public has been opened up for those very reasons. So you can be assured they are the very model of prudence and wisdom. Constant tinkering [...]
In a period when weird and unusual are commonplace, it was one of the more noteworthy and interesting outliers. Late in August 2010, a media report attributed to Hong Kong’s Ming Pao news agency suggested Zhou Xiaochuan was on the run. Supposedly, the Governor for the People’s Bank of China, the country’s central bank, was defecting to the United States [...]
It was a startling statement for the time. Mario Draghi had only been on the job as President of the European Central Bank for a few months by then, taking over for the hapless Jean Claude-Trichet who was unceremoniously retired at the end of October 2011 amidst “unexpected” chaos and turmoil. It was Trichet who contributed much to the tumult, [...]
To most people, this inflation business seems pretty silly. There are those who argue that any inflation index whether the CPI, PCE Deflator or some other approach yet to be devised can accurately capture the concept. And they are absolutely right to question the enterprise. Most people feel inflation in the things they do most; food, health insurance, the cost [...]
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 [...]
QT. Bank reserves. Balance sheet normalization. They really are going through all the motions in 2019. It’s as if officials can sense something just isn’t quite right. This would amount to a serious setback, of course, having assured the public repeatedly how the financial system has been remade into “resilient.” Janet Yellen, call your current office, Jay Powell’s Federal Reserve [...]
During the first quarter of 2008, as Bear Stearns teetered on the edge of illiquidity, foreign holders of US$ financial assets contributed $9.3 trillion to US credit markets. According to the Fed’s Z1, the Financial Accounts of the United States, it tells us that’s the amount they held in possession from outside the American geographical boundary. Considering at the same [...]
The obsession with inflation is grounded in historical fact. This is true both of our recent “conundrum” as well as broader circumstances surrounding slow burning structural changes. As to the former, last year the global economy was supposed to take off, concurrently signaled by accelerating inflation rates due to what are always claimed to be tight labor markets. The worldwide [...]
Germany is a tough one to get around. Argentina falls into a bad recession, you can get by believing that’s not particularly unusual or interesting. If its neighbor Brazil becomes shaky, you can still chalk it up to EM volatility. Italy is Europe’s perpetual basket case. China’s a little more difficult, but still that country has its own unique problems. [...]
Even I’ve become numb over the years to some of the blatant mischaracterizations. Looking at any small positive number for whatever small economic account and declaring it the mark of a strong economy is standard procedure nowadays. But it’s the brazenness with which “they” are now attempting to discount the sudden reappearance of the minuses. I’ve said all along that [...]
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