Follow us or the Bunny gets it. No
Bunny gets it

Subscribe for newsletter


Follow us in Twitter



Gold standard and monetary metals:


Subscribe for browser push notifications

Category Archive: 4.) Marc to Market

Filter archive by: Show All Show only Articles Show only Videos

Thoughts on the Chinese Export Puzzle

2016-03-10

by

2016-03-10

Investors are skeptical of Chinese economic data.  However, news yesterday that Chinese exports fell by a quarter in February was shocking. Many worry about the implications not just for China, but for world growth.  It comes as the IMF is signaling it will likely cut its 3.4% global growth forecast next month. There are three … Continue...

Read More »

Merkel’s Challenge

2016-03-09

by

2016-03-09

German Chancellor Merkel was right. As the Greek crisis was winding down last summer, she noted that the refugee problem would be even more difficult.  And indeed, it is. The refugee issue is challenging Merkel’s leadership in Europe.  While her trademark has been her sensitivity to swings in sentiment, she has seemed rather tone-deaf in …

Read More »

Great Graphic: Vulnerability of the Canadian Dollar

2016-03-09

by

2016-03-09

The Canadian dollar appears vulnerable.  It remains firm while the US two-year premium over Canada has risen sharply.   Like others, we do not expect the Bank of Canada to cut rates today and are looking past it. This Great Graphic was composed on Bloomberg.  It shows the 2-year spread (white line) and the US dollar …

Read More »

FX Daily, 03/09: Euro Pushes Lower Ahead of ECB

2016-03-09

by

2016-03-09

The euro has peeled off a cent from yesterday's high near $1.1060 as some short-term players move to the sidelines ahead of the ECB meeting.  Recall that after peaking near $1.1375 on February 11 when the New Year's market angst peaked, the euro fell back to the lower end of its old range near $1.0825 … Continue reading »

Read More »

A Few Things on Our Mind

2016-03-09

by

2016-03-09

A few weeks ago investors were bemoaning a new bear market for equities, and there was much ink spilled drawing parallels between now and 2008-2009.   Falling commodities, weakening growth, and prospects of Fed tightening saw the MSCI Emerging Market equity index fall 21.5% from early-November through the third week in January.  Since then it has …

Read More »

FX Daily 03/08: Greenback Lacks Momentum, While Profit-Taking Weighs on Dollar-Bloc

2016-03-08

by

2016-03-08

Recent trends which include firmer equities and oil, weaker euro and bonds, and stronger dollar-bloc currencies are in reverse today, a turn-around Tuesday of sorts. MSCI's Emerging Market equity index is snapping a seven-day advancing streak, giving back yesterday's gains and a little more.  However, Chinese shares managed to post small gains. China reported a …

Read More »

Japan: Data and Flows

2016-03-07

by

2016-03-07

Early Tuesday in Tokyo, Japan will announce revisions to Q4 GDP.  A downward revision to business spending risks shaving the initial estimate from a contraction of 1.4% at an annualized rate to 1.5%.  Regardless, the key takeaway is that the world's third-largest economy contracted in two of the four quarters last year.   Recall Initially, the …

Read More »

Great Graphic: US 2-year Premium over Germany and Japan at New Cyclical Highs

2016-03-07

by

2016-03-07

We argue that the dollar is in its third significant rally since the end of Bretton Woods in 1971.  The Reagan dollar rally was driven by the policy mix of tight monetary policy and loose fiscal policy.  The G7 effort to stop the dollar's appreciation at the Plaza Hotel in September 1985 marked the end … Continue...

Read More »

FX Daily, 03/07: Dollar and Yen Post Gains to Start the Week

2016-03-07

by

2016-03-07

The US dollar is retracing part of its pre-weekend losses against the European currencies and dollar-bloc today while falling equity prices are underpinning the yen.   Brent is nearing $40 a barrel, and WTI is pushing through $36.   Iron ore prices were limit up in China.  US 10-year Treasury yield is three bp higher to poke … Continue...

Read More »

Investment Climate Improves

2016-03-06

by

2016-03-06

Sometimes the news stream drives prices, and sometimes the price action drives the narratives.  We argued that the sharp decline in equities at the start of the year was fanned the doom and gloom in the media and market commentary.  Many had been taking about a new financial crisis and parallels were drawn between the … Continue...

Read More »

Near-term Dollar Outlook is Nuanced

2016-03-06

by

2016-03-06

The US dollar fell against all the major and most of the emerging market currencies last week.   Risk appetites have been rekindled, and the yen has gone from the best performer in recent weeks to the worst over the past week.   Major equity markets advanced for the third week.  The MSCI Emerging Market equity index … Continue reading...

Read More »

Weekly Speculative Positions: Speculators Add to Short Euro and Sterling

2016-03-06

by

2016-03-06

Speculators in the currency futures made mostly small adjustments to their gross foreign currency exposure.  There were only three position adjustments of more than 5k contacts.   Since the markets turned on 11 February, the Canadian dollar has been the strongest of the major currencies, appreciating a little more than 4.5% against the US dollar.    Gross …

Read More »

US Jobs Headline Better than Details

2016-03-04

by

2016-03-04

The optics of the US jobs report was better than the details, which is the exact opposite of the January employment report.  The US dollar strengthened on the news. The US created 242k jobs in February.  The consensus was for around 195k.  The January gain of 151k was revised up to 172k The household survey … Continue reading »

Read More »

US Jobs Data Awaited, but Barring Significant Surprise, May Not be Key Driver

2016-03-04

by

2016-03-04

The US dollar is mixed ahead of the US employment data.  The Antipodeans and Scandis are doing best while sterling and the Canadian dollar are under-performing.  Investors appetite for risk has increased.  The market is confident that the next ...

Read More »

Great Graphic: Inflation Expectations via 10-Year Breakevens

2016-03-03

by

2016-03-03

Over the next fortnight the major central banks, including the ECB, BOJ, Fed and BOE will hold policy-making meetings.  Of the four, expectations are the highest for the ECB to ease policy. Given the poor economic data, including deflationary pressures, and the tightening of financial conditions, the BOJ could also adjust policy.  However, after the …

Read More »

FX Daily, 03/03: Markets Calm; Waiting For…?

2016-03-03

by

2016-03-03

The global capital markets are quiet today, as investors await fresh impetus which could come in the form of tomorrow's US national employment figures.  There is also next week's ECB meeting that looms large for investors.   The euro is tradin...

Read More »

Are Central Banks Exaggerating Deflation Risks?

2016-03-02

by

2016-03-02

Deflation is portrayed as the great economic scourge.  It exacerbates debt servicing costs and encourages consumers to defer purchases.  Central banks in Japan and Europe have responded with aggressive, unorthodox measures, often combining asset purchase programs with negative interest rates.   However, deflation is not very deep, and the measurement is not very precise.  In recent years, …

Read More »

FX Daily 03/02: Markets Take Another Step Away from the Edge

2016-03-02

by

2016-03-02

The angst that characterized the first several weeks of the year continues to dissipate.  Major equity markets are extending their two-week recovery into a third week. Immediate concerns about the US falling into a recession have eased.  The market have withstood some downward pressure on the Chinese yuan.  Late yesterday Moody's cut its outlook for China's credit …

Read More »

Great Graphic: Surplus Capacity is not the Same as Insufficient Aggregate Demand

2016-03-02

by

2016-03-02

Many economists argue that the key challenge is that of insufficient aggregate demand.  That is why world growth is slow.  Hobbled with debt, households have pulled back.  Business investment is weak.  Government dissavings has been offset by household and business savings.  The solution offered by some economists is a large public investment program. The G20 …

Read More »

Great Graphic: Gold Triangle–Continuation or Reversal Pattern?

2016-03-01

by

2016-03-01

During a period in which the zero bound no longer is the floor of interest rates, and many central banks continue to ease policy,  we have been watching gold a bit closer.   In early January, we noted that the technical pattern warned of breakout.  Our first objective was $1110-$1135. In early February, we updated our …

Read More »