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Tag Archives: Global Economy

Has the Global Economy Finally Exhausted its Good Luck?

The past three decades of global growth are rarely attributed to luck: it’s all the result of our brilliant fiscal, monetary and trade policies. Those in positions of wealth and power are delighted to take credit for this tremendous success, but as a general rule, the more knowledgeable you are and the higher up the food chain you are, the greater your awareness of the role of luck in any unbroken chain of success. There are various moving parts in what we call luck. One...

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Black Monday 1987 vs 2019 – Part II

Our research team has been attempting to answer the question that seems to be on everyone’s minds right now – are we setting up another Black Monday type of event in the global markets and what should traders/investors know before the event potentially takes place.  Our research team has spent the past few weeks trying to better understand the global economic events that took place 8 to 20+ years before the Black Monday event happened and have been particularly interested in the 10+ years...

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QE4ever Arrives in One Quantifiable Quantum Leap!

It’s QE4ever, Baby! The Fed’s latest move back into quantitative easing took a quantum leap in a single day with last week’s rush announcement of major permanent money injections to begin this Tuesday. Since the Fed adamantly denies it is doing what it is doing — going back to quantitative easing (because they legally have to deny it) — we could just call it the Fed’s new quantitative mechanics. If we must avoid the term quantitative easing, as some writers are insisting we should, I’ve come...

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Central Bankers’ Desperate Grab for Power

Central bankers are out of ammunition. Mark Carney, the soon-to-be-retiring head of the Bank of England, admitted as much in a speech at the annual meeting of central bankers in Jackson Hole, Wyo., in August. “In the longer-term,” he said, “we need to change the game.” The same point was made by Philipp Hildebrand, former head of the Swiss National Bank, in a recent interview with Bloomberg. “Really, there is little if any ammunition left,” he said. “More of the same in terms of monetary...

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Central Bankers Now Plotting Government Subversion?

Two weeks ago a former Federal Reserve board member and bank president, William Dudley, wrote an editorial that encouraged the Fed use its powers to defeat Donald Trump’s second bid for the US presidency. I don’t recall choosing presidents as being listed in the Fed’s two mandates — controlling inflation while maximizing employment. For an organization that has been speaking a lot lately about the importance of its independence from politics, that was the most overtly political statement...

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China Beige Book Warns Economic Slowdown Has Begun

When it comes to the global economy, few things matter as much as China, the trajectory of its economy and especially the pace and impulse of its credit creation, which is ironic because virtually all data coming out of China is fabricated and manipulated, and thoroughly untrustworthy, either on purpose or "by accident." The latest example of the former was highlighted over the weekend, when we discussed that a nationwide Chinese audit found some local...

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Bitcoin – Millennials Fake Gold

I’ve been asked about Bitcoin a lot lately. I’ haven’t written anything about it because I find myself in an uncomfortable place in agreeing with the mainstream media: It’s a bubble. Bitcoin started out as what I’d call “millennial gold” – the young (digital) generation looked at it as their gold substitute. Bitcoin is really two things: a blockchain technology and a (perceived) currency. The blockchain element of Bitcoin may have enormous future applications: It may be used for electronic...

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No Peace In Our Times: The Inevitability Of War

Via GEFIRA, “While people are saying, peace and safety, destruction will come on them suddenly, as labor pains on a pregnant woman, and they will not escape.” Are you, man or woman of Christian and European heritage, aware of this prophecy or do you prefer to live in a fancy world of happy-clappy wishful thinking that the brotherhood of men is about to put an end to human conflict once and for all? Though Christmastide is a time of merrymaking, it may also be a period of reflection. The...

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Uninvestable Tesla

Tesla is an uninvestable stock for me, not just because of its high valuation but also because it fails our fairly basic quality test, which I shamelessly borrowed from Warren Buffett: Would I still buy this stock if right after the purchase the stock market were to close for ten years? If you are a big Tesla car and stock fan, before you start throwing rocks at me, pause and wait till you finish this article – the rocks and I will still be there. Think about the next ten years. But before...

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WTF Chart Of The Week

Authored by Jeffrey Snider via Alhambra Investment Partners, Back in early October, I noted that repo fails had jumped above $250 billion (combined “to receive” and “to deliver”) for three weeks straight. That wasn’t an auspicious result, as sustained collateral problems like that don’t correlate to happy things. It all began the week of September 5, in what seemed like a minor one-day nuisance over the 4-week bill yield. October was something of lull in repo and other things, too. Nothing...

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