The Federal Reserve in early 2012 altered longstanding monetary policy. In January that year, the FOMC had voted to make explicit what everyone already knew, that it considered 2% inflation to be the definition of “stable” consumer prices, casting off one of the last vestiges of 1980’s era regimes where central bankers felt silence was the best course. It had [...]
Inventories in the fourth quarter rebounded rather sharply, at least in terms of how inventory is calculated as a contribution to GDP. The GDP version of inventory turned negative in Q2, and was only slightly positive in Q3. In the final quarter of 2016, however, the total change is preliminarily estimated to have been $51.1 billion. That isn’t quite back [...]
Gross Domestic Product for the fourth quarter of 2016 disappointed once again, which is to say that it was perfectly consistent. At just 1.856%, quarter-over-quarter, it was the fifth time out of the past six quarters less than 2%. Only last quarter where unusual export activity pushed GDP up was the growth rate anywhere close to what it should be [...]
From the outside, it appears as if Wall Street operates like a bureaucracy. There is an enormous amount of paperwork, endless committees who conduct endless meetings, and layers of management supposedly managing the movement of that paperwork as well as the meetings of those committees. The idea is simple enough, to make it appear as if there is tremendous weight [...]
For Ben Bernanke, characterizing a successful tenure is exceedingly hard. Afterward writing a memoir about his time at the Fed, however, made such a task a necessary one. Given so few options from which to define his legacy, the former Chairman decided very carefully about how to frame his efforts. And still all he could come up with was a [...]
Earned income rates adjusted for inflation have been near zero growth for two months in a row. Real average weekly earnings were revised significantly lower in November 2016, turning a small 0.5% gain into just 0.2%. The latest figures for December estimate the same lack of growth to end the year. In seasonally-adjusted terms, weekly earnings did not keep pace [...]
Inflation in China slowed somewhat in December, as the Consumer Price Index decelerated to 2.1% from 2.3% in November. Very much like in the US, Europe, and Japan, the CPI level in China continues a lengthy stretch significantly below the official monetary target. For China, the PBOC has set 3% as its definition of “price stability.” The last time inflation [...]
Then-Federal Reserve Chairman Ben Bernanke testified before Congress on May 22, 2013, that taper was for officials a strong consideration. Though QE4, the UST portion of the restored balance sheet expansion, wasn’t yet six months old and he had promised, sort of, at the start of QE3 that both would be open-ended, sort of, his message to the legislature was [...]
It was announced yesterday that former New Jersey governor and one-time head of MF Global John Corzine won’t be allowed anywhere near clients in the futures business. Though a lifetime ban, the man is already 70 years old and the damage done. Perhaps there is some more comfort in the $5 million fine levied against him in addition to the [...]
The BLS reported what was on the surface another lackluster payroll report. All the headline numbers conformed to the slowed economy view of 2016. The Establishment Survey gained just 156k in December, following an upward revised 204k in November. The 6-month average, a far more appropriate interpretation given inherent statistical volatility month to month, is just 189k. The Household Survey [...]
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