If that wasn’t the most anticlimactic worst economic quarter in history. The numbers were just as bad as people were expecting – which is the point. It’s not like this economic collapse snuck up on anyone, nor did its scale and depth. We’ve all known from the very beginning what the deal was going to be. Headline real GDP fell [...]
These numbers do seem epic, don’t they? It’s hard to ignore when you have the greatest percentage increase in the history of a major economic account. Just writing that sentence it’s difficult to deny the power of those words. Which is precisely the point: we already know ahead of time how the biggest economic holes in history are going to [...]
From a monetary policy perspective, smooth is what you are aiming for. What central bankers want in this age of expectations management is for a little bit of steady inflation. Why not zero? Because, they decided, policymakers need some margin of error. Since there is no money in monetary policy, it takes time for oblique “stimulus” signals to feed into [...]
Another day, another new Federal Reserve “bailout.” As these things go by, quickly, the details become less important. What is the central bank doing today? Does it really matter?For me, twice was enough. All the way back in 2010 I had expected other people to react as I did to QE2. If you have to do it twice, it doesn’t [...]
Forward-looking data is starting to trickle in. Germany has been a main area of interest for us right from the beginning, and by beginning I mean Euro$ #4 rather than just COVID-19. What has happened to the German economy has ended up happening everywhere else, a true bellwether especially manufacturing and industry. The latest sentiment figures from ZEW as well [...]
When Mario Draghi sat down for his scheduled press conference on April 4, 2012, it was a key moment and he knew it. The ECB had finished up the second of its “massive” LTRO auctions only weeks before. Draghi was still relatively new to the job, having taken over for Jean-Claude Trichet the prior November amidst substantial turmoil. The non-standard [...]
Shocking, perhaps, but in no way unexpected. IHS Markit didn’t just throw a wrench into all that talk about a global rebound, the organization solidly hammered a substantial nail in its coffin. According the flash estimates for February 2020, the US economy hit a skid. The manufacturing version dropped back to 50.8 from 51.9 in January. The rebound on this [...]
They put it off so long they backed themselves into this corner. The Japanese government under Prime Minister Shinzo Abe had originally scheduled two VAT tax hikes as part of the rollout for Abenomics. It would be inflationary and fiscally responsible all in one pass. To make sure Japan’s perpetually struggling economy could absorb any fallout from them while still [...]
It’s just Germany. It’s just industry. The excuses pile up as long as the downturn. Over across the Atlantic the situation has only now become truly serious. The European part of this globally synchronized downturn is already two years long and just recently is it becoming too much for the catcalls to ignore. Central bankers are trying their best to, [...]
The lull in US consumer spending on goods has reached a fifth month. The annual comparisons aren’t good, yet they somewhat mask the more recent problems appearing in the figures. According to the Census Bureau, total retail sales in January rose 4.58% year-over-year (unadjusted). Not a good number, but better, seemingly, than early on in 2019 when the series was [...]
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