Category Archive: 5.) Alhambra Investments

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2019: The Year of Repo

2020-01-04

Fed Balance Sheet: Reserve Balances, 2008-2019

The year 2019 should be remembered as the year of repo. In finance, what happened in September was the most memorable occurrence of the last few years. Rate cuts were a strong contender, the first in over a decade, as was overseas turmoil. Both of those, however, stemmed from the same thing behind repo, a reminder that September’s repo rumble simply punctuated.

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Inflation Fairy Tale: Why It’s Deflation We Should Worry About (w/ Steven Van Metre & Jeff Snider)

2020-01-01

by Jeffrey P. Snider

Is inflation on the horizon? Should bank reserve balances stored with the Federal Reserve count as "money"? According to Jeffrey Snider, head of global research at Alhambra Investment Partners, and Steven Van Metre, macro fund manager and founder of Portfolio Shield, the answer to these questions is a resounding "no." Drawing upon a data ranging from Treasury auction sales to Eurodollar futures curves, van Metre and Snider explain why low yields...

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A Sour End To The 2010’s Doesn’t Have To Spoil The Entire 2020’s

2020-01-01

by Jeffrey P. Snider

2020-01-01

It has been perhaps the most astonishing divergence in the first two decades of 21st century history. In late 2017, Western economic officials (mostly central bankers) were taking their victory laps. They took great pains to tell the world it was due to their profound wisdom, deep courage, and, most of all, determined patience, that they had been able to see their policies through to the light of day (no thanks to voters around the world).

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All-Stars #85 Jeff Snider: U.S. Dollar Year End Review & 2020 Outlook

2019-12-23

by Jeffrey P. Snider

Please visit our website www.macrovoices.com to register your free account to gain access to supporting materials.

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Everything Comes Down To Which Way The Dollar Is Leaning

2019-12-21

by Jeffrey P. Snider

2019-12-21

Is the global economy on the mend as everyone at least here in America is now assuming? For anyone else to attempt to answer that question, they might first have to figure out what went wrong in the first place. Most have simply assumed, and continue to assume, it has been fallout from the “trade wars.”

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Latest European Sentiment Echoes Draghi’s Last Take On Global Economic Risks

2019-12-19

by Jeffrey P. Snider

2019-12-19

While sentiment has been at best mixed about the direction of the US economy the past few months, the European economy cannot even manage that much. Its most vocal proponent couldn’t come up with much good to say about it – while he was on his way out the door. At his final press conference as ECB President on October 24, Mario Draghi had to acknowledge (sort of) how he is leaving quite the mess for Christine Lagarde.

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China Data: Something New, or Just The Latest Scheduled Acceleration?

2019-12-18

by Jeffrey P. Snider

2019-12-18

The Chinese government was serious about imposing pollution controls on its vast stock of automobiles. The largest market in the world for cars and trucks, the net result of China’s “miracle” years of eurodollar-financed modernization, for the Chinese people living in its huge cities the non-economic costs are, unlike the air, immediately clear each and every day.

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A Repo Deluge…of Necessary Data

2019-12-18

by Jeffrey P. Snider

2019-12-18

Just in time for more discussions about repo, the Federal Reserve delivers. Not in terms of the repo market, mind you, despite what you hear bandied about in the financial media the Fed doesn’t actually go there. Its repo operations are more RINO’s – repo in name only. No, what the US central bank actually contributes is more helpful data.

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If The Best Case For Consumer Christmas Is That It Started Off In The Wrong Month…

2019-12-17

by Jeffrey P. Snider

2019-12-17

Gone are the days when Black Friday dominated the retail calendar. While it used to be a somewhat fun way to kick off the holiday shopping season, it had morphed into something else entirely in later years. Scenes of angry shoppers smashing each other over the few big deals stores would truly offer, internet clips of crying children watching in horror as their parents transformed their local Walmart into Thunderdome.

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Lagarde Channels Past Self As To Japan Going Global

2019-12-14

by Jeffrey P. Snider

2019-12-14

As France’s Finance Minister, Christine Lagarde objected strenuously to Ben Bernanke’s second act. Hinted at in August 2010, QE2 was finally unleashed in November to global condemnation. Where “trade wars” fill media pages today, “currency wars” did back then. The Americans were undertaking beggar-thy-neighbor policies to unfairly weaken the dollar.

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The FOMC Channels China’s Xi As To Japan Going Global

2019-12-13

by Jeffrey P. Snider

2019-12-13

The massive dollar eruption in the middle of 2014 altered everything. We’ve talked quite a lot about what Euro$ #3 did to China; it sent that economy into a dive from which it wouldn’t escape. And in doing so convinced the Chinese leadership to give growth one more try before changing the game entirely once stimulus inevitably failed.

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If Trade Wars Couldn’t, Might Pig Wars Change Xi’s Mind?

2019-12-12

by Jeffrey P. Snider

2019-12-12

Forget about trade wars, or even the eurodollar’s ever-present squeeze on China’s monetary system. For the Communist Chinese government, its first priority has been changed by unforeseen circumstances. At the worst possible time, food prices are skyrocketing. A country’s population will sit still for a great many injustices. From economic decay to corruption and rising authoritarianism, the line between back alley grumbling and open rebellion is...

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Disposable (Employment) Figures

2019-12-11

by Jeffrey P. Snider

2019-12-11

Establishment Survey; Blowout Payrolls, 2014-2019

If last month’s payroll report was declared to be strong at +128k, then what would that make this month’s +266k? Epic? Heroic? The superlatives are flying around today, as you should expect. This Payroll Friday actually fits the times. It wasn’t great, they never really are nowadays (when you adjust for population and participation), but it was a good one nonetheless.

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The BIS Misses An Opportunity To Get Consistent With The Facts

2019-12-11

by Jeffrey P. Snider

2019-12-11

Net lending through repos and federal funds by size group

Much has been made about the repo market since mid-September. Much continues to be made about it. The question is why. It is now near the middle of December and repo looks dicey despite repo operations and a not-QE small-scale asset purchase intended to increase the level of bank reserves. Always the focus on “funds” which may be available. It was John Adams who took on the task of defending several British soldiers on trial for the Boston...

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You Will Never Bring It Back Up If You Have No Idea Why It Falls Down And Stays Down

2019-12-10

by Jeffrey P. Snider

2019-12-10

Friedman's Plucking Model of Trend-cycle Analysis

It wasn’t actually Keynes who coined the term “pump priming”, though he became famous largely for advocating for it. Instead, it was Herbert Hoover, of all people, who began using it to describe (or try to) his Reconstruction Finance Corporation. Hardly the do-nothing Roosevelt accused Hoover of being, as President, FDR’s predecessor was the most aggressive in American history to that point, economically speaking.

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All-Stars #83 Jeff Snider: Objective analysis of global USD liquidity yields a different story…

2019-12-09

by Jeffrey P. Snider

All-Stars #83 Jeff Snider: Objective analysis of global USD liquidity yields a different story than financial media are telling Please visit our website www.macrovoices.com to register your free account to gain access to supporting materials.

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European Economy: A Time Recession

2019-12-08

by Jeffrey P. Snider

2019-12-08

Eurostat confirmed earlier today that Europe has so far avoided recession. At least, it hasn’t experienced what Economists call a cyclical peak. During the third quarter of 2019, Real GDP expanded by a thoroughly unimpressive +0.235% (Q/Q). This was a slight acceleration from a revised +0.185% the quarter before.

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Fails Swarms Are Just One Part

2019-12-08

by Jeffrey P. Snider

2019-12-08

There it was sticking out like a sore thumb right in the middle of what should have been the glory year. Everything seemed to be going just right for once, success so close you could almost feel it. Well, “they” could. The year was 2014 and the unemployment rate in the US was tumbling, the result of the “best jobs market in decades.” Real GDP in that year’s two middle quarters was pretty near 5% in both.

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All Signs Of More Slack

2019-12-07

by Jeffrey P. Snider

2019-12-07

The evidence continues to pile up for increasing slack in the US economy. While that doesn’t necessarily mean there is a recession looming, it sure doesn’t help in that regard. Besides, more slack after ten years of it is the real story. The Federal Reserve’s favorite inflation measure in October 2019 stood at 1.31%, matching February for the lowest in several years.

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More Signals Of The Downturn, Globally Synchronized

2019-12-07

by Jeffrey P. Snider

2019-12-07

For US importers, October is their month. And it makes perfect sense how it would be. With the Christmas season about to kick into full swing each and every November, the time for retailers to stock up in hearty anticipation is in the weeks beforehand. The goods, a good many future Christmas presents, find themselves in transit from all over the world during the month of October.

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