rate hikes

What Does It Mean That Real Estate, Not Equities, Is Driving Monetary Policy?

By |2019-07-23T18:31:49-04:00July 23rd, 2019|Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

In the world of assets classes, I don’t believe it is equities which hold the Federal Reserve’s attention. After the 2006-11 debacle, the big bust, you can at least understand why policymakers might be more attuned to real estate no matter how the NYSE trades. It may be a decade ago, but that’s the one [...]

Curve-sanity

By |2019-06-12T19:01:18-04:00June 12th, 2019|Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

There are those which are so very clear in their disingenuousness – to the point of overdoing it and becoming obviously absurd. In the increasingly desperate rush to downplay the headlong race to rate cuts, this one’s up there: Eurodollar futures traders, having decided that the Federal Reserve is likely to cut the fed funds [...]

How Do You Get A September Rate Cut?

By |2019-06-03T12:18:46-04:00June 3rd, 2019|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

When the eurodollar futures curve first inverted a year ago in the wake of May 29, 2018, it was the market beginning to hedge against serious and rising risks of something that would force the Federal Reserve to turn around. When that might happen, or how many cuts would eventually follow, those were questions the [...]

Curves Have Pointed The Way, And It’s The Way They Still Point

By |2019-05-10T16:35:07-04:00May 10th, 2019|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

In the middle of last November, when the Dallas branch of the Federal Reserve convened a conference on “global perspectives”, ironically, its officials were in a very good mood. The institution’s Chairman, Jay Powell, invited to speak at the gathering spelled out exactly why. Central bankers since Greenspan have made a habit of trying to [...]

Not Only No Labor Shortage, Latest Labor Market Data Is Closer to Rate Cuts

By |2019-05-02T16:03:27-04:00May 2nd, 2019|Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

Yesterday, the FOMC altered its view of household spending and business capex. It wasn’t a huge difference, they never are. Figuratively, these sorts of downgrades are little by little even though if things were ever to go the right way the language upgrades wouldn’t be subject to so much reservation. There isn’t much in the [...]

The Long Running Circus of Uncertainty Circles Back

By |2019-04-10T16:21:08-04:00April 10th, 2019|Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

Most of the best circuses used to have three main rings. Nowadays, we can only get the occasional show for two on the same day. It is a rare treat when central bankers from two major jurisdictions compete for the world’s misapprehending attention. Today is one of those days: Mario Draghi and the ECB as [...]

Where Doves Are Dreaded

By |2019-03-20T15:48:15-04:00March 20th, 2019|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

If “rate hikes” and QT are the world’s big problem in 2019, then why is the FOMC announcing the end of “rate hikes” and QT failing to have a positive effect? The answer will surprise most people. Central banks, dominated by central bankers who are Economists, meaning statisticians, are always behind. They do not lead. [...]