Category Archive: 5) Global Macro

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Optimal Lunacy

2017-04-15

In June 2012, Janet Yellen, then the Vice Chairman of the Federal Reserve, addressed an audience in Boston with what for the time seemed like a radical departure. It was the latest in a string of them, for conditions throughout the “recovery” period never did quite seem to hit the recovery stride. Because of that, there was constant stream of trial balloons suggesting how the Federal Reserve might try to overcome this economic inertia. At that...

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Millennials Are Abandoning the Postwar Engines of Growth: Suburbs and Autos

2017-04-14

by Charles Hugh Smith

2017-04-14

Where's the growth going to come from as the dominant generation makes less, borrows less, spends less, saves more and turns away from long commutes, malls and suburban living and abandons the worship of private vehicles?

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Tim Berners-Lee explains what it will take to make the internet more accessible | The Economist

2017-04-13

by The Economist

The internet is inaccessible to 60% of the world’s population. Tim Berners-Lee, the web’s inventor, has decided to change this. Click here to subscribe to The Economist on YouTube: http://econ.trib.al/rWl91R7 60% of the world’s people are still not connected to the internet. The majority of these are women and people living in poverty. In July …

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Who’s Playing The Long Game–and What’s Their Game Plan?

2017-04-13

by Charles Hugh Smith

2017-04-13

When we speak of The Long Game, we speak of national/alliance policies that continue on regardless of what political party or individual is in office. The Long Game is always about the basics of national survival: control of and access to resources, and jockeying to diminish the power and influence of potential adversaries while strengthening one's own power and influence.

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The Global Burden

2017-04-12

by Jeffrey P. Snider

2017-04-12

Bundesrepublik Deutscheland Finanzagentur GmbH (German Finance Agency) was created on September 19, 2000, in order to manage the German government’s short run liquidity needs. GFA took over the task after three separate agencies (Federal Ministry of Finance, Federal Securities Administration, and Deutsche Bundesbank) had previously shared responsibility for it.

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Bi-Weekly Economic Review

2017-04-11

by Joseph Y. Calhoun

2017-04-11

It is hard not to notice that the chart above has a lot less red in it than it has in some time. That is true of the month to month data as well as the year over year changes. There has been a widely reported gap between so called soft data – surveys and polls – and the hard data – actual economic activity reports. Bulls say the gap is there because the soft data always leads the hard data.

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It Was And Still Is The Wrong Horse To Bet

2017-04-11

by Jeffrey P. Snider

2017-04-11

The payroll report disappointed again, though it was deficient in ways other than are commonly described. The monthly change is never a solid indication, good or bad, as the BLS’ statistical processes can only get it down to a 90% confidence interval, and a wide one at that. It means that any particular month by itself specifies very little, except under certain circumstances.

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Why China has become the world leader in renewable energy

2017-04-11

by The Economist

China is the world’s largest emitter of greenhouse gases, using fossil fuels to drive rapid industrialisation. So why is it now investing billions of dollars in green technology? Click here to subscribe to The Economist on YouTube: http://econ.trib.al/rWl91R7 China is the world’s largest emitter of greenhouse gases. Its water, air and soil are heavily polluted. …

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Emerging Markets Preview for the Week Ahead

2017-04-10

by Win Thin

2017-04-10

EM FX ended the week on a soft note, as the weaker than expected US jobs data was unable to derail the dollar’s rally. For the week, the worst performers were ZAR (-3%), TRY (-2.5%), and RUB (-2%). CZK bucked the trend, rising after the CNB exited the cap. This week, higher inflation readings in the US could draw market focus back to Fed tightening, which would be negative for EM.

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US Jobs: Who Carries The Burden of Proof?

2017-04-09

by Jeffrey P. Snider

2017-04-09

The idea that interest rates have nowhere to go but up is very much like saying the bond market has it all wrong. That is one reason why the rhetoric has been ratcheted that much higher of late, particularly since the Fed “raised rates” for a third time in March. Such “hawkishness” by convention should not go so unnoticed, and yet yields and curves are once more paying little attention to Janet Yellen.

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Emerging Markets: What has Changed

2017-04-08

by Win Thin

2017-04-08

Reserve Bank of India surprised markets with the start of the tightening cycle. The Czech National Bank (CNB) ended the EUR/CZK floor. Israeli central bank said it won’t hike rates until Q2 2018. Both S&P and Fitch cut South Africa’s rating one notch to sub-investment grade BB+. Moody's put South Africa’s Baa2 rating on review for a downgrade.

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Ultra-Loose Terminology, Not Policy

2017-04-08

by Jeffrey P. Snider

2017-04-08

As world “leaders” gathered in Davos in January 2016, they did so among financial turmoil that was creating more economic havoc than at any time since the Great “Recession.” Having seen especially US QE as the equivalent of money printing, their focus was drawn elsewhere to at least attempt an explanation for the contradiction.

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We Need To Define The ‘Shadows’, And All Parts of Them; or, ‘Rising Dollar’ Kills Another Recovery Narrative

2017-04-07

by Jeffrey P. Snider

2017-04-07

JP Morgan’s CEO Jamie Dimon caused a stir yesterday with his 45-page annual letter to shareholders. The phrase that gained him so much widespread attention was, “there is something wrong with the US.” Dimon mentioned secular stagnation and correctly surmised it was the right idea if for the wrong reasons. He then gave his own which included a litany of globalist agenda items, including not enough access to mortgages.

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Life on the frontline of Ukraine’s war | The Economist

2017-04-07

by The Economist

War has raged in eastern Ukraine for the past three years between Ukraine’s army and Russian-backed separatists. Two residents discuss how they live their lives under a constant fear of shelling and whether they see an end in sight to fighting. Click here to subscribe to The Economist on YouTube: http://econ.trib.al/rWl91R7 Since 2014, Russian-backed rebels …

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February US Trade Disappoints

2017-04-06

by Jeffrey P. Snider

2017-04-06

The oversized base effects of oil prices could not in February 2017 push up overall US imports. The United States purchased, according to the Census Bureau, 71% more crude oil from global markets this February than in February 2016. In raw dollar terms, it was an increase of $7.3 billion year-over-year. Total imports, however, only gained $8.4 billion, meaning that nearly all the improvement was due to nothing more than the price of global oil.

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Systemic Depression Is A Clear Choice

2017-04-05

by Jeffrey P. Snider

2017-04-05

Looking back on late 2015, it is perfectly clear that policymakers had no idea what was going on. It’s always easy, of course, to reflect on such things with the benefit of hindsight, but even contemporarily it was somewhat shocking how complacent they had become as a global group.

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Incomes Always Deviate Negative

2017-04-05

by Jeffrey P. Snider

2017-04-05

Personal Income growth in February 2017 was more mixed than it had been of recent months. Nominal Disposable Per Capita Income increased 3.73% year-over-year, while in real terms Per Capita Income was up 1.57%. For the former, that was among the better monthly results over the past year, while the latter was near the worst.

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Brexit: Hope vs reality. A cartoon by Kal

2017-04-04

by The Economist

British Prime Minister Theresa May is determined to make Brexit happen, regardless of the outcome. Our cartoonist Kal gives his take. Click here to subscribe to The Economist on YouTube: http://econ.trib.al/rWl91R7 Daily Watch: mind-stretching short films every day of the working week. For more from Economist Films visit: http://films.economist.com/ Check out The Economist’s full video …

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Consensus Inflation (Again)

2017-04-04

by Jeffrey P. Snider

2017-04-04

Europe Harmonized Inflation Consumer Prices , 2013 - 2019

Why did Mario Draghi appeal to NIRP in June 2014? After all, expectations at the time were for a strengthening recovery not just in Europe but all over the world. There were some concerns lingering over currency “irregularities” in 2013 but primarily related to EM’s and not the EU which had emerged from re-recession. The consensus at that time was full recovery not additional “stimulus.” From Bloomberg in January 2014:

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When the “Solutions” Become the Problems

2017-04-04

by Charles Hugh Smith

2017-04-04

Those benefiting from these destructive "solutions" may think the system can go on forever, but it cannot go on when every "solution" becomes a self-reinforcing problem that amplifies all the other systemic problems.

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