Tag Archive: economy

The Conspicuous Rush To Import

2018-01-12

According to the Census Bureau, US companies have been importing foreign goods at a relentless pace. In estimates released last week, seasonally-adjusted US imports jumped to $204 billion in November 2017. That’s a record high finally surpassing the $200 billion mark for the first time, as well as the peaks for both 2014 and 2007.

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The Reluctant Labor Force Is Reluctant For A Reason (and it’s not booming growth)

2018-01-10

by Jeffrey P. Snider

2018-01-10

In 2017, the BLS estimates that just 861k Americans were added to the official labor force, the denominator, of course, for the unemployment rate. That’s out of an increase of 1.4 million in the Civilian Non-Institutional Population, the overall prospective pool of workers. Both of those rises were about half the rate experienced in 2016.

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The Great Risk of So Many Dinosaurs

2018-01-07

by Jeffrey P. Snider

2018-01-07

The Treasury Borrowing Advisory Committee (TBAC) was established a long time ago in the maelstrom of World War II budgetary as well as wartime conflagration. That made sense. To fight all over the world, the government required creative help in figuring out how to sell an amount of bonds it hadn’t needed (in proportional terms) since the Civil War. A twenty-person committee made up of money dealer bank professionals and leaders was one of the few...

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Industrial production: The Chinese Appear To Be Rushed

2018-01-04

by Jeffrey P. Snider

2018-01-04

All China's Dollars, Aug 2016 - Jan 2018

While the Western world was off for Christmas and New Year’s, the Chinese appeared to have taken advantage of what was a pretty clear buildup of “dollars” in Hong Kong. Going back to early November, HKD had resumed its downward trend indicative of (strained) funding moving again in that direction (if it was more normal funding, HKD wouldn’t move let alone as much as it has). China’s currency, however, was curiously restrained during that...

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Bi-Weekly Economic Review: Housing Market Accelerates

2018-01-03

by Joseph Y. Calhoun

2018-01-03

The economy ended 2017 with current growth just slightly above trend. In general the reports of the last two weeks of the year were pretty good with housing a standout performer going into the new year. We are still trying to get past the impact – positive and negative – from the hurricanes a few months ago though so it is probably prudent to wait for more evidence before making any definitive pronouncements about the economy.

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The Economy Likes Its IP Less Lumpy

2017-12-23

by Jeffrey P. Snider

2017-12-23

US Industrial Production, Jan 2011 - Dec 2017

Industrial Production rose 3.4% year-over-year in November 2017, the highest growth rate in exactly three years. The increase was boosted by the aftermath of Harvey and Irma, leaving more doubt than optimism for where US industry is in 2017. For one thing, of that 3.4% growth rate, more than two-thirds was attributable to just two months.

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Chinese Are Not Tightening, Though They Would Be Thrilled If You Thought That

2017-12-22

by Jeffrey P. Snider

2017-12-22

The PBOC has two seemingly competing objectives that in reality are one and the same. Overnight, China’s central bank raised two of its money rates. The rate it charges mostly the biggest banks for access to the Medium-term Lending Facility (MLF) was increased by 5 bps to 3.25%. In addition, its reverse repo interest settings were also moved up by 5 bps each at the various tenors (to 2.50% for the 7-day, 2.80% for the 28-day).

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In Unprecedented Intervention, Swiss Central Bank Bails Out Firm That Prints Swiss Banknotes

2017-12-21

by Tyler Durden

2017-12-21

In the most ironic story of the day, the company that makes the paper that Swiss banknotes are printed on was just bailed out by the money-printing, stock-purchasing, plunge-protecting, savior-of-global equities…Swiss National Bank. While The SNB has a long and checkered history of buying shares in companies… as we have detailed numerous times.

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Retail Sales Bounce (Way) Too Much

2017-12-21

by Jeffrey P. Snider

2017-12-21

Retail sales had a good month of November, or at least what counts as decent over the last five and a half years. Total retail sales (unadjusted) rose 6.35% last month, up from 4.9% (revised higher) in October. It was the highest rate of growth since the 29-day month of February 2016. For retailers, what matters is that it comes at the start of the Christmas shopping season.

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Bubble Watch: Warning Signs That The Everything Bubble Will Burst in 2018

2017-12-20

by Graham Summers

2017-12-20

I believe 2018 will be the year inflation arrives. The reason, as I’ve noted throughout mid-2017, is that multiple Central Banks, particularly the European Central Bank (ECB), Bank of Japan (BoJ) and Swiss National Bank (SNB) have maintained emergency levels of QE and money printing, despite the fact that globally the economy is performing relatively well.

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Bi-Weekly Economic Review: Animal Spirits Haunt The Market

2017-12-20

by Joseph Y. Calhoun

2017-12-20

The economic data over the last two weeks continued the better than expected trend. Some of the data was quite good and makes one wonder if maybe, just maybe, we are finally ready to break out of the economic doldrums. Is it possible that all that new normal, secular stagnation stuff was just a lack of animal spirits?

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Chart of the Week: Collateral

2017-12-16

by Jeffrey P. Snider

2017-12-16

It’s been a week of quite righteous focus on collateral. The 4-week bill equivalent yield closes it at just 114 bps, with only three days left before the RRP “floor” is moved up by the FOMC to 125 bps. That’s too much premium in price, though we know why given what FRBNY reported for repo fails last week.

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China Exports and Industrial Production: Revisiting Once More The True Worst Case

2017-12-16

by Jeffrey P. Snider

2017-12-16

As weird as it may seem at first, the primary economic problem right now is that the global economy looks like it is growing again. There is no doubt that it continues on an upturn, but the mere fact that whatever economic statistic has a positive sign in front of it ends up being classified as some variant of strong. That’s how this works in mainstream analysis, this absence of any sort of gradation where if it’s negative it’s bad (though in 2015...

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Jim Grant: “Markets Trust Too Much In The Presence Of Central Banks”

2017-12-15

by Christoph Gisiger

2017-12-15

James Grant, Wall Street expert and editor of the renowned investment newsletter «Grant’s Interest Rate Observer», warns of the unseen consequences of super low interest rate and questions the extraordinary actions of the Swiss National Bank. Nearly ten years after the financial crisis, extraordinary monetary policy has become the norm.

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Year-end Rate Hike Once Again Proves To Be Launchpad For Gold Price

2017-12-15

by Jan Skoyles

2017-12-15

Year-end rate hike once again proves to be launchpad for gold price. FOMC follows through on much anticipated rate-hike of 0.25%. Spot gold responds by heading for biggest gain in three weeks, rising by over 1%. Final meeting for Federal Reserve Chair Janet Yellen. Yellen does not expect Trump's tax-cut package to result in significant, strong growth for US economy. No concern for bitcoin which 'plays a very small role in the payment system'.

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Defining The Economy Through Payrolls

2017-12-15

by Jeffrey P. Snider

2017-12-15

The year 2000 was a transition year in a lot of ways. Though Y2K amounted to mild mass hysteria, people did have to get used to writing the date with 20 in front of the year rather than 19. It was a new millennium (depending on your view of Year 0) that seemed to have started off under the best possible terms. Not only were stocks on fire at the outset, the economy was, too.

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A Race To The Potential Behind Bitcoin

2017-12-13

by Jeffrey P. Snider

2017-12-13

The timing just never seems to fall in our favor. If we had had this conversation ten years ago as would have been appropriate, then this evolution might have fell perfectly in our collective laps. Just as the global financial system, really the international, interbank monetary system of the eurodollar, was crashing all around us, the genesis block of the Bitcoin blockchain was hard coded.

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Three Years Ago QE, Last Year It Was China, Now It’s Taxes

2017-12-13

by Jeffrey P. Snider

2017-12-13

China Manufacturing PMI, May 2007 - Nov 2017

China’s National Bureau of Statistics reported last week that the official manufacturing PMI for that country rose from 51.6 in October to 51.8 in November. Since “analysts” were expecting 51.4 (Reuters poll of Economists) it was taken as a positive sign. The same was largely true for the official non-manufacturing PMI, rising like its counterpart here from 54.3 the month prior to 54.8 last month.

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Giant Sucking Sound Sucks (Far) More Than US Industry Now

2017-12-11

by Jeffrey P. Snider

2017-12-11

Case Study in Conundrum, Jan 1997 - 2004

There are two possibilities with regard to stubbornly weak US imports in 2017. The first is the more obvious, meaning that the domestic goods economy despite its upturn last year isn’t actually doing anything positive other than no longer being in contraction. The second would be tremendously helpful given the circumstances of American labor in the whole 21st century so far. In other words, perhaps US consumers really are buying at a healthy pace,...

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Reduced Trade Terms Salute The Flattened Curve

2017-12-10

by Jeffrey P. Snider

2017-12-10

The Census Bureau reported earlier today that US imports of foreign goods jumped 9.9% year-over-year in October. That is the second largest increase since February 2012, just less than the 12% import growth recorded for January earlier this year.

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