Tag Archive: Featured

Dollar Remains Under Pressure as European Outlook Shines

2020-07-28

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2020-07-28

US Inflation Expectations, 2019-2020
The outlook for risk assets remains uncertain; the dollar continues to make new lows; the uncertain outlook continues to propel gold and silver higher. The next round of stimulus in the US is proving to be difficult; regional Fed manufacturing surveys for July will continue to roll out. German July IFO survey came in better than expected; eurozone June M3 rose 9.2% y/y vs. 8.9% in May.

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The Myth of the Failure of Capitalism

2020-07-28

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2020-07-28

The nearly universal opinion expressed these days is that the economic crisis of recent years marks the end of capitalism. Capitalism allegedly has failed, has proven itself incapable of solving economic problems, and so mankind has no alternative, if it is to survive, than to make the transition to a planned economy, to socialism.

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FX Daily, July 27: Dollar Slide Continues, while Gold Soars

2020-07-27

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2020-07-27

The US dollar's dramatic sell-off continues. It is off against nearly all currencies.  Among the majors, the Swedish krona and Japanese yen are leading the money, and the euro surged through $1.17.  Emerging market currencies are fully participating, with the JP Morgan Emerging Market Currency Index posting its fifth gain in six sessions.

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“Monetäre Staatsfinanzierung mit Folgen (Monetary Financing of Government),” Die Volkswirtschaft, 2020

2020-07-27

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2020-07-27

Die Volkswirtschaft, 24 July 2020. PDF. Clarifying the connections between outright monetary financing, QE, the distribution of seignorage profits, the relationship between fiscal and monetary policy, and central bank independence.

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Most returning to Switzerland from Covid-19 risk countries skipping quarantine

2020-07-27

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2020-07-27

Less than half of those returning to Switzerland from countries listed by the Swiss government as having a high risk of SARS-CoV-2 infection are complying with the quarantine rules set out in Switzerland’s Epidemic Act, according to an estimate by the NZZ newspaper.

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US Stall? Only Half The Imagined “V” May Indicate One, Too

2020-07-27

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2020-07-27

IHS Markit US Composite, 2018-2020
These are not numbers that are consistent with a robust rebound. In fact, they don’t indicate very much of one at all. IHS Markit’s flash PMI’s for July 2020 instead look way too much like the sentiment indicators in Germany and Japan. Though they are now back near 50, both services and manufacturing, that doesn’t actually indicate what everyone seems to think it does.

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Money-Supply Growth Hits New High For Third Month In a Row

2020-07-27

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2020-07-27

M2 and TMS, in billions of $, 1996-2020
In June, for the third month in a row, money supply growth surged to an all-time high, following new all-time highs in both April and May that came in the wake of unprecedented quantitative easing, central bank asset purchases, and various stimulus packages.

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Gold futures end a stone’s throw away from a record

2020-07-27

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2020-07-27

Gold futures ended higher for a fifth straight session Thursday, with the most-active contract just short of notching a settlement record, highlighting feverish demand for bullion amid the worst pandemic in over a century.

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Swiss business raided over Fiat-Iveco ‘Dieselgate’ probe

2020-07-26

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2020-07-26

Investigators have searched offices of car giant Fiat Chrysler and truck maker CNH Industrial in Switzerland, Germany and Italy as part of a German-led probe into suspected illegal manipulation of diesel emissions.

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Referendum launched against SwissCovid app

2020-07-26

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2020-07-26

A group in Switzerland has decided to launch a vote against Switzerland’s contact tracing app, an application designed to make it easier to know whether someone has been in contact with someone infected with the SARS-CoV-2 virus.

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Introducing the “Everything Bubble” Sentiment-o-Meter

2020-07-26

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2020-07-26

Since human wetware remains stuck in OS1.01, we can predict a remarkable reversal. The "Everything Bubble" has been a sight to behold. With central banks providing trillions to the big players and margin debt enabling small punters to leverage up, the hot money rotation has been a real merry-go-round as one asset and sector after another is ignited by a massive flood of money seeking a quick return.

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New Opportunities for Marxists: Climate Change and Coronavirus

2020-07-26

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2020-07-26

In The Communist Manifesto (1848) Karl Marx (1818–83) and Friedrich Engels (1820–95) predicted that capitalism would lead to the impoverishment of the laboring class. Why? Well, to raise profit on capital invested, Marx and Engels argued, entrepreneurs (the capitalists) would exploit the workers.

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Is the West repeating India’s mistakes?

2020-07-26

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2020-07-26

Following the publication of our last conversation with Jayant Bhandari, I received a lot of interesting feedback and remarks. The common denominator of all those comments was the astonishment of many Western readers at the real conditions and dynamics on the ground in India.

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Unprecedented Recession Synchronization

2020-07-26

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2020-07-26

Percent of Economies in Recession, 1871-2021
The global recession is an unprecedented recession synchronization. Deflationary Consequences: Lacy Hunt at Hoisington Management explains the deflationary consequences of the current global situation in its Second Quarter 2020 Review.

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Switzerland adds 15 nations to its list of compulsory quarantine countries

2020-07-25

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2020-07-25

From 23 July 2020, people arriving in Switzerland from 42 nations must quarantine for 10 days. On 23 July 2020, the government added 15 nations to its existing list of nations where there is an increased risk of SARS-CoV-2 infection.

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Swiss humanitarian trade deal with Iran faces delay, questions 

2020-07-25

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2020-07-25

Swiss “good offices” between Tehran and Washington have brought about a humanitarian aid channel allowing Swiss-based companies to send medicines and other vital goods to Iran despite US sanctions. But it remains to be seen to what extent the now-delayed deal will help the Iranian people versus Swiss political and economic interests. 

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Cool Video: Gold and the Dollar

2020-07-25

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2020-07-25

I have been talking with Neils Christensen, editor at Kitco news, for several years about the dollar, gold, and my read of the capital markets more broadly.  We had a chance to discuss recent developments yesterday. I began my career at a small newswire, and Kitco reminds me of it.

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The (Other) Shoe Of Unemployment

2020-07-25

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2020-07-25

Global PMIs & Sentiment, 2017-2020
After raising the specter of a rebound stall, the idea before limited to Japan and Germany was abruptly given further weight today by US jobless claims numbers. For the first time since the peak at the end of March, the weekly tally of initial filings increased from the prior week.

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Three Reasons Representative Democracy Doesn’t Work

2020-07-25

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2020-07-25

In representative democracies, voters ostensibly control the state through the politicians they vote for. However, most representative democracies fall far short of this goal. Three of the reasons for the trouble are the problems of scale, bundling, and omission.

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FX Daily, July 24: Strong PMIs Have Limited Impact as Profit-Taking Hits Equities

2020-07-24

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2020-07-24

US stocks stumbled yesterday, and the S&P 500 nearly gave back the week's gains with its roughly 1.25% loss, the largest of the month.  The NASDAQ 100 fell to two-week lows.  Slower cloud growth at Microsoft and a delay in the next generation of chips at Intel were among the drags.

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