deflation

Downward Home Prices In The Downturn, Too

By |2019-10-24T19:03:26-05:00October 24th, 2019|Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

The Census Bureau reported today New Home Sales remained at a better than 700k SAAR in September following the big jump over the previous few months. Though the number was slightly lower last month than the month before, it wasn’t meaningfully less. As discussed yesterday, while that might seem the Fed’s rate cut psychology combined [...]

China’s Dollar Problem Puts the Sync In Globally Synchronized Downturn

By |2019-10-16T16:49:25-05:00October 16th, 2019|Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

Because the prevailing theory behind the global slowdown is “trade wars”, most if not all attention is focused on China. While the correct target, everyone is coming it at from the wrong direction. The world awaits a crash in Chinese exports engineered by US tariffs. It’s not happening, at least according to China’s official statistics. [...]

The Corroboration and Costs of Fear Gold

By |2019-08-27T17:02:18-05:00August 27th, 2019|Bonds, Commodities, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

Gold is the ultimate hedge, but it is far from perfect. Unlike, say, sovereign bonds there should be no expectation for a negatively correlated price. You can buy a UST or German bund even at negative yields and at least expect the price to rise when things are at their worst. Flight to safety or [...]

As Chinese Factory Deflation Sets In, A ‘Dovish’ Powell Leans on ‘Uncertainty’

By |2019-07-10T12:24:25-05:00July 10th, 2019|Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

It’s a clever bit of misdirection. In one of the last interviews he gave before passing away, Milton Friedman talked about the true strength of central banks. It wasn’t money and monetary policy, instead he admitted that what they’re really good at is PR. Maybe that’s why you really can’t tell the difference Greenspan to [...]

Being An Economist Means Never Having To Say Deflation

By |2019-02-11T17:19:07-05:00February 11th, 2019|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

In January 2017, there was a lot of praise for Goldman Sachs especially in London. This stood in obvious contrast to another global peer being savaged. While Deutsche Bank couldn’t pull its name out of the sewer, GS’s London unit was heralded for standing up when the market needed it. Brexit was a fascinating story [...]

Chinese Robots, New York Heartburn, and Goldman Sach’s Central Role

By |2019-02-05T17:59:06-05:00February 5th, 2019|Bonds, Commodities, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

In the continued absence of regular data, as the US federal government attempts to get back up to speed before the next lull, it is perhaps appropriate to continue on with this week’s parade of anecdotes. Here I’ll discuss three of them, each seemingly unrelated to the others. To begin, we start with Chinese robots. [...]

Revisiting Hong Kong (For Reasons We Wish We Wouldn’t Have To)

By |2019-01-17T17:45:19-05:00January 17th, 2019|Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

This is perhaps the perfect day to review what’s going on in Hong Kong (thanks J. Fraser). I’ll be in Vancouver over the weekend to talk about curves, so why not preface it with a little HKD update. With everyone focused elsewhere, the story of 2017, in my view, wasn’t so big in 2018. For [...]

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