It’s not just that there was an obvious and intense change in sentiment, as that is quite common among and within markets. It is more so that this repetition is a little too familiar. In January, the mainstream was taken aback as the world looked headed for a very dark place, all “unexpected” of course. Just a few months later, [...]
It was an impressive rebound from the doldrums of February 11. Stocks managed to get back nearly even, as the S&P 500 closed above 2,100 on successive days April 19 and 20. Since then it has been more of a struggle; sideways to slightly lower. Gold has remained near and above $1,250 while funding markets and UST’s have been bid [...]
Inflation is a complicated subject that has been devalued as if it were simply some variable in an equation. It starts with the very premise itself, as if an index of a bucket of consumer prices equals a comprehensive review of the subject. As Irving Fisher realized more than a century ago, money can go into places beyond any CPI’s [...]
Today was the third consecutive down day or selling in eurodollar futures. The June 2018 contract settled below 98.80 for the first time in April, almost unwinding the move higher at the start of this month. Even after the selling, the eurodollar curve remains as depressed as ever, discounting an entirely different set of future circumstances than stocks or junk [...]
On April 12, Muhammadu Buhari, President of Nigeria, was in Beijing to negotiate Chinese aid for his ailing country. At home, the government faces an enormous budget deficit largely on the price of oil. The more immediate threat, however, is that Nigeria in large part due to oil prices is being squeezed by monetary shortage. The country is an import-heavy [...]
The focus on China and the Chinese economy is not just related to its size but more so the fact that it is the pivot point for the whole global system. In pure economic terms, as “end demand” from the developed world economies slows, the Chinese economy either absorbs that reduction (through its own internal “stimulus”) or passes it on [...]
It is remarkable the disparity in views on display by various markets and what that suggests about what is driving each. In stocks and especially junk bonds, you get the sense of a massive sigh of relief that “it’s all over”, and while scary for a time it’s back to momentum and not missing out on the big money bargains. [...]
The world cheered this morning’s trade estimates from China, as both exports and imports rebounded from a dismal start to the year. Exports rose 11.5% in March after falling 25% in February; imports fell “only” 7.6% after declining 13.8% the month before. Despite the difficulties with data calculations around the Lunar New Year, economists were quick with their usual glowing [...]
China’s official reported reserves rose in March for the first time in five months. Though reserves had fallen to barely $3.2 trillion in February, that was down just $28.6 billion from January, being already hailed as a success and a step in the right direction since that was less than a third of the shocking decline in January (-$99.5 billion). [...]
It’s never a good sign when bank stocks are leading any retreat, but that is especially the case given recent events when several high profile banks were at the epicenter of early 2016’s liquidation rerun. As usual, Deutsche Bank and Credit Suisse are the firms most mentioned and among those most disfavored at these times. The media struggles to find [...]
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