Thoughts From The Bar Stool…
Friday, 18 October 2019 | 12:46 pm
Readers of this blog will be aware that I have been bearish about global economic and political conditions for some time now. Yet I find things to buy. I leave for my vacation and will return in 2 weeks and will endeavor to monitor news and markets as little as possible. But befor e I
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Inequality. QE. Trade War and More.
Tuesday, 15 October 2019 | 8:46 am
Populists may be wrong in their prescriptions, but they are not wrong in their prognoses. Inequality If it feels like inequality, it probably is. 1% of the world’s population hold 47% of its wealth. To qualify, they must have at least 700,000 USD in assets. The share of wealth of the top 1% has been
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Bad news is good. Bad news is bad. Which one holds is arbitrary.
Thursday, 03 October 2019 | 8:51 am
In recent times equity and credit markets have reacted to bad news with optimism, reasoning that weaker economic data would encourage the central banks to cut rates which would in turn boost the economy and support higher asset valuations. This is a perverse logic but one that supports trillions of dollars in investments. This year,
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A little change is coming…
Tuesday, 01 October 2019 | 3:54 pm
Fiscal policy will join monetary policy in the fight against stagnation. 10 years of loose monetary policy has inflated assets while failing to raise growth or inflation. Orthodoxy is slowly pivoting towards fiscal policy. The textbook dangers of unlimited monetary and fiscal support are, excessive and rising national debt and the eventual loss of confidence
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Yield Curve Inversion. The Fed. The QE Trap.
Friday, 20 September 2019 | 3:59 pm
For a while now, the Fed funds effective rate has pushed up against the upper bound of the Fed funds target rate. If not for the Fed, short term rates would have risen above the target range. We see this pressure in repo rates, not just this week but for some months now, where repo
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