At the same time the Bank of Japan cut its outlook for “inflation” last month, seriously violating the standard set at the beginning of QQE to meet its target within 2-years, they also raised their growth predictions for the coming fiscal year (starting in April). Nobody seems to have appreciated the irony of that since almost all of the increase [...]
With the Chinese manufacturing indications “unexpectedly” disappointing over the weekend it was absolutely no surprise that US estimates of income and especially spending would as well. These overall, broader figures align closely with other indications of a dangerously weak household sector, very much explaining why the rest of the world is screaming about impending contraction. For all that intuitive sense [...]
Another “unexpected” decline in home data has raised even bigger questions about the idea that the real estate market is settling into some steady and slow growth period. That has been the revised hope after the MBS disaster in late 2013. The middle of 2014 saw a renewed not-quite-enthusiasm for real estate which led to the belief that housing might [...]
The level of new home sales seemed to take another run at the 500k seasonally-adjusted annual rate in December. This would be the third time in 2014 that the pace of sales reached a new high point for this cycle, but the prior two were subsequently revised much lower. In fact, revisions have made it very difficult to find much [...]
There may be something to December after all. It was credit markets that shifted downward (bearish yield curves and credit spreads) dramatically around the end of November and the first few days of December. Given the persistence of large players moving credit and funding markets, this may not be all that hard to fathom with the close proximity of credit [...]
For all the hype about jobs and the booming (GDP) economy, the major portion of the retailer calendar around Christmas was a total bust. In many ways it was worse than last year, which emphasizes simply how the business “cycle” as it was understood in textbook economics no longer applies. The US economy, indeed the global economy as there are [...]
Turning attention to that last bastion of monetary surety, equities, the oil slump might be the greatest challenge yet to the non-stop stock escalator. Earnings especially for the S&P 500 are being revised lower as energy companies weigh on results. And while there may be a tendency to dismiss energy as its own problem, there is much deeper unwinding underneath [...]
Payroll Friday lived up to its recent billing, offering those who see the economy as booming their headlines while providing nothing beyond that by which to confirm it. There is maybe a growing sense, given market action (especially bonds), that the headlines are becoming less “moving” and that this disparity has been internalized more so than at any time in [...]
In light of what I detailed yesterday about the real reason the Fed is proclaiming economic success and an end to ZIRP, today’s minutes reveal a good deal of internal discussion leading toward that idea. The first part being that there is no wage growth today, and thus this notion of “transitory” non-inflation being nothing more than faith: Although a [...]
In commentary about Shinzo Abe’s overwhelming re-election last week, there was a growing sense of divergence between rhetoric and support. Clearly, Abe’s administration had the nearly full support of the Japanese people, a fact due more than anything to the manner in which “economics” is not just reported but understood. In describing the looming track of a worse recession from [...]
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