The problem continues to be, I’m sure, is one of perception. Economists, politicians, and mostly central bankers have been saying for years that the real economy is the one you see in the unemployment rate. Things are booming. The labor market is awesome, even epically tight. Between last year and this year, going by the unemployment rate the economy has [...]
The markets we use to monitor the economy (and those that influence it, which amounts to the same thing) have been tracking an economic slowdown since the 4th quarter of last year. That's when interest rates, real and nominal, long term and short term, started to decline, credit spreads started to widen and the copper to gold ratio started to [...]
It's been a slow turnin' From the inside out A slow turnin' But you come about Slow learnin' But you learn to sway A slow turnin' baby Not fade away Now I'm in my car I got the radio on I'm yellin' at the kids in the back 'Cause they're bangin' like Charlie Watts Slow Turning by [...]
Another discussion with Erik Townsend of MacroVoices about bonds, rate cuts, and what's behind everything this year. https://youtu.be/RvFBkFaPKoY
The benchmark 10-year US Treasury yield closed below 2% for the first time since Donald Trump was elected President. Having flirted with that level several times over the past week, today the most-watched interest rate on the planet finally breached this one startling round number. And it comes during a week which by every conventional account should have been hugely [...]
It was supposed to be the Chinese government who was going to rescue the global economy. Once the rationalizations ended and officials around the world realized there was serious economic weakness building at the end of 2018 instead of a globally synchronized inflationary recovery, the green shoots of 2019 were going to be in one big part a fiscal stimulus [...]
Last week, for the first time since February 2008, the LIBOR curve inverted. The 3-month tenor has been on the move downward for some time. The 1-month rate has been gentler in its slope. Last Thursday, the two finally crossed. As unnatural as inversion in the UST curve or elsewhere, it’s another sign of imminent rate cuts. I am somewhat [...]
If you have nothing left, it can sound like a winning argument but you have to really try hard enough. In October 2015, with another false dawn dawning on the public, former Federal Reserve Chairman Ben Bernanke wrote and op-ed published in the Wall Street Journal. As had become his habit, it was full of praise – for his own [...]
After what is all but certain to be the final “rate hike” in this cycle, Bloomberg reported that President Trump had previously explored all possible legal ramifications of demoting Federal Reserve Chairman Jay Powell. The issue has become a major one, in the media, anyway, now that Mr. Powell has indicated his error. There will be no further hikes this [...]
It’s never just one payroll report. The month-to-month changes in the Establishment Survey barely qualify as statistically significant, let alone meaningful. What that means is one good monthly headline is nothing to get excited about, just as one bad month shouldn’t get anyone too worked up. May 2019’s jobs report, however, isn’t in isolation. The headline for the Establishment Survey [...]
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