It has certainly been much calmer in October so far, especially compared with the deep deviations following the FOMC’s lack of activity. Stocks have rallied since October 1 along with many commodities, especially crude. Currencies have been almost mellow, with the ruble following oil prices upward, the real departing (for now) from its devastation and even those like the Indian [...]
And so it goes, back to the Asian “dollar” again. The reverberations back and forth are nothing if not remarkable, revealing, I believe, some very real divisions between the general and “traditional” eurodollar and the new(ish) Asian “dollar.” Last week, it was the eurodollar out front while China and Hong Kong were seemingly enjoying the relief. This week started with [...]
By most accounts the Asian “dollar” was quiet last night but now the “regular” eurodollar is in full form. That might suggest greater care with these terms as the yen appears to be in that latter mix despite geographically belonging to the former. For purposes of clarification, then, since Japanese banks were among the original sources of the eurodollar buildup [...]
If for the Asian “dollar”, then China’s inability to place an economic bottom is a problem for every market and economy. The more hopeful mainstream rhetoric from the summer is now gone, just as the “dollar” would have it. China’s variations have far too closely matched these “dollar” waves which, in the midst of another, is not a hopeful sign [...]
Copper prices are getting pummeled this morning. Since copper is somewhat unique in its setting between wholesale finance and the real economy, but most especially what might fairly be termed the Asian dollar, it functions not just as a “dollar” proxy but perhaps more focused than that. We can assume by copper’s selloff today (the price for October futures delivery [...]
Outwardly, you can appreciate why central banks act as they do under serious and dangerous circumstances. Prices aren’t just what someone will pay but also represent information that is transmitted broadly to all corners. Thus, if something is going wrong there are prices that will show it, potentially diffusing contagion to other places and markets. From a child-like perspective, it [...]
There is no bottom in sight yet for China. Despite five interest rate cuts and traditional interpretations of monetary “stimulus”, the economy continues to decelerate beyond mainline understanding. Industrial production was just 6.1% in August, marking the thirteenth consecutive month (counting January, which is combined with February due to China’s New Year) below 8%, while retail sales rose 10.8%. Fixed [...]
It seems as if the PBOC is doing a whole lot and getting very little from it. That is actually expected at least to anyone not caught up in the cult of QE and the like, as that is the very nature of central banks dating back to the original at the Bank of England. Even though the focus has [...]
In a world saturated by derivatives, the concept of a bellwether of a bellwether might actually make sense. If China is one for the global economy then perhaps South Korea might be it for China. Unlike Japan, South Korea hasn’t had the yawning chasm of QQE to alter its balances, therefore the level of shipments particularly to China offer perhaps [...]
That's the question everyone is asking these days. Will the Fed go ahead and raise interest rates at their next meeting? Or is the economy still so soft they don't dare derail what recovery we've managed to attain? Was last week's employment report good enough to keep the Fed on track to do what they seem to think they need [...]
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