Category Archive: Global Macro

Why the Democrats Can’t Let Go of Losing

The Democratic Party has become everything it once was against. The Democratic Party has become everything that it once loathed: elitist, globalist, interventionist, self-serving, warmongering and overflowing with hubris.

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Emerging Markets: What has Changed?

China will raise the sales tax on small cars to 7.5% in 2017. New methodology used by Turkstat to measure Turkish GDP has led to significant upward revisions. Turkish authorities are growing more concerned about the weak lira. Fitch moved the outlook on Chile. Chile’s central bank shifted to an expansionary policy bias. Colombia selected Juan Jose Echavarria to be the new central bank governor. Fitch revised the outlook on Mexico’s BBB+ rating from...

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Recovering America’s History of Progressive Populism

The elites' toadies, lackeys, shills, sycophants, water-carriers and apologists are desperately hyping the context-free, historically ignorant narrative that "populism leads to autocracy" to protect the existing autocracy of the elites.

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Rich Middle Class, Poor Middle Class

This great generational injustice is the direct consequence of central banks lowering interest rates to zero and inflating asset bubbles. How can middle class households have similar incomes but some are asset-rich and others are asset-poor?

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“Fake News”, Censorship, Darwin and Democracy

Perhaps we can start by separating "news" from "analysis" from "commentary." "News" is "he said this, she did that, this happened." Analysis tries to make sense of trends that are apparent in the news longer-term--for example, why did Trump win? Is the economy actually healthy or not? "Commentary" is opinion that establishes a point of view and defends it while attacking other POVs.

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From Captive Audience to Open Democracy: Why the Mainstream Media Is Freaking Out

In its panicky rush to demonize the independent media via baseless accusations of "fake news," the mainstream press has sunk to spewing "fake news" of its own. Here's The Washington Post's criminally false "fake news" article in case you missed it: Russian propaganda effort helped spread ‘fake news’ during election, experts say.

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Emerging Markets: Week Ahead Preview

After the ECB meeting, we saw curve steepening in the eurozone. This is on top of curve steepening in the US since the elections. While we are nowhere near the magnitude of the 2013 Taper Tantrum, these yield curve dynamics remain negative for EM bonds and EM FX. EM equities are a different matter, supported in part by the continued post-election rally in DM equity markets. Higher commodity should also help insulate some EM countries from the...

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A Disintegrative Winter: The Debt and Anti-Status Quo Super-Cycle Has Turned

With this list of manifestations in hand, we can practically write the headlines for 2017-2025 in advance. How would you describe the social mood of the nation and world? Would anti-Establishment, anti-status quo, and anti-globalization be a good start? How about choking on fast-rising debt? Would stagnant growth, stagnant wages be a fair description? Or how about rising wealth/income inequality? Wouldn't rising disunity and political polarization...

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200 Russian Propaganda Sites, or simply alternative media?

The following is the list of "Russian Propaganda sites", as published by PropOrNot. Several articles by the Washington Post refer to this list. Many sites on that list are based on libertarian ideas and Austrian economics. Those are in favor of a free market economy, they reject central banks and the establishment. The rejection of the U.S. establishment is possibly the only point that are in common with Putin.

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Charles Hugh Smith a Russian Propaganda Site?

We highly appreciate the site of Charles Hugh Smith because it integrates good economic graph with critical political comments. A couple of days ago, it appeared on a list of "Russian Propaganda Sites" that got cited by mainstream media.

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Emerging Markets: What has Changed

Hong Kong Chief Executive Leung Chun-ying said he won’t seek a second term. Korea’s parliament voted 234-56 to impeach President Park. Czech National Bank raised the possibility of negative rates to help manage the currency. A Brazilian Supreme Court justice removed Senate chief Renan Calheiros from his post, but was later overturned by the full court. Brazil central bank signaled a possibly quicker easing cycle.

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Global Warm-Ongering: What Happens If Trump Takes US Out Of Paris Agreement?

For all the shock, horror, and aghast of global warm-ongers, comes a startling revelation: It’s Irrelevant if US Pulls Out of Paris Accord. Donald Trump has sent his clearest message yet about his plans for reshaping US policy on global warming by choosing a chief environmental regulator who has questioned the science of climate change.

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Populism in America: “Follow the Money”

If you want to understand today's populism, don't look to the mainstream media's comically buffoonish propaganda blaming the Russians: look at the four issues listed below. One of the most disturbing failures of the mainstream media in this election cycle was its complete lack of historical context for Trump's brand of populism.If you consumed the mainstream media's coverage of the campaign and election, you noted their obsession with speech acts...

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Our “Gaslight” Economy

If you don't like what these charts are saying, please notify The Washington Post to add the St. Louis Federal Reserve to its list of Russian propaganda sites. Yesterday I described our gaslight financial system. Today we'll look at our gaslight economy. Correspondent Jason H. alerted me to the work of author Thomas Sheridan ( Puzzling People: The Labyrinth of the Psychopath), who claims to have coined the term gaslighting.

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Emerging Markets: Preview of the Week Ahead

EM remains a mixed bag. Despite the negative connotations of a rising US rate environment, EM gathered an element of stability last week as the dollar consolidated its recent gains. Rising commodity prices are also helping EM at the margin, with RUB and COP amongst the best last week on higher oil and CLP on higher copper.

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Net National Savings Rate, the Best Alternative Indicator to GDP Growth

For us the Net National Savings Rate is the best alternative indictator to GDP growth. It is positively correlated with the change in wealth, with the establishment of future productive capacity, the price of government bonds and currency valuations. But today GDP growth is often negatively correlated to the Net Savings Rate. Hence GDP is often a less useful measure.

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Beyond Income Inequality

Judging by the mainstream media, the most pressing problems facing capitalism are 1) income inequality, the basis of Thomas Piketty’s bestseller Capital in the Twenty First Century, and 2) the failure of laissez-faire markets to regulate their excesses, a common critique encapsulated by Paul Craig Roberts’ recent book and 2) the failure of laissez-faire markets to regulate their excesses, a common critique encapsulated by Paul Craig Roberts’ recent...

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Six Narratives on the Ascendancy of Trump

A remarkably diverse array of "explanations" of Donald Trump's presidential election victory have been aired, representing both the conventional political spectrum and well beyond.

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Emerging Markets: Week Ahead Preview

EM ended last week on a somewhat firmer note, though we note divergences remain in place. For the week, ZAR and KRW performed the best while TRY and BRL were the worst. US jobs data Friday will draw some attention, though a December Fed rate hike is pretty much fully priced in.

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Why Is the US Dollar Rising?

Note the apparent breakout above 100 and the constructive similarities to the 2014 breakout that was followed by a 20% increase in the purchasing power of the USD relative to other currencies.

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