Tag Archives: 5) Global Macro

The dollar has stabilized a bit; Friday’s US jobs data could be a game changer The US bond market selloff continues; for now, the weak dollar trend is hard to fight The Brazilian government has found a way to make a bad situation worse by trying to control its Covid-19 statistics German IP came in a bit worse than expected at -17.9% m/m; the OPEC+ deal ended with the expected supply cut deal, lending continued support to crude prices Japan Q1 GDP revised higher on...

The dollar remains under pressure, due in large part to the Fed’s aggressive efforts to inject stimulus. We see dollar weakness persisting near-term. From a longer-term perspective, we note that the greenback remains largely rangebound and is unlikely to fall below its 2018 lows. Dollar Index, 2015-2020 - Click to enlarge RECENT DEVELOPMENTS There is a growing debate as to the root causes of recent dollar weakness. Is it the burgeoning national debt? The poor US...

The global crisis is not merely economic; it is the result of profound financial, sociological and political trends described by Marx, Kafka, Orwell and Huxley. The unfolding global crisis is best understood as the convergence of the dynamics described by Marx, Kafka, Orwell and Huxley. Let’s start with Franz Kafka, the writer (1883-1924) who most eloquently captured the systemic injustices of all-powerful bureaucratic institutions–the alienation experienced by the...

The bill for extreme wealth/income inequality is now overdue, and the penalties for ignoring the bill will be as extreme as the inequality. Our socio-economic-political system–let’s call it the status quo–has been hollowed out by extremes of wealth/power inequality driven by financialization and globalization, which have enriched the top 5% and left everyone else behind. As a result, the status quo has become increasingly fragile and brittle even as cheerleaders...

That which has failed is unsustainable, no matter how many trillions the Federal Reserve tosses against the tides of history. The Gulfs Between the Classes The Credibility Gap The Partnerships That Failed The Groups That Opted Out The Undermining of Effort Every one of these is a manifestation of institutional failure. The Gulfs Between the Classes (see chart of soaring inequality below) manifests a completely broken economic and social order, and the abject...

Risk sentiment is taking a breather today after a strong run; the dollar is getting some modest traction Fed tweaked its municipal bond program; weekly jobless claims are expected to rise 1.843 mln; Brazil and Mexico are seeing record high daily death counts ECB is expected to ease today; Germany agreed on a new fiscal package that exceeded expectations BOE warned that UK banks should plan for a possible hard Brexit; Swiss deflation is deepening Australia reported...

As the old models break down, opportunities for new models will arise. Unstable, unsustainable systems can lull observers into a comfy complacency as instability increases beneath a thin veneer of apparent stability. That’s the systemic story of the past 20 years: all the extremes that were needed to maintain the veneer of stability have increased the instability building beneath the complacent confidence. But sadly for the status quo, all bubbles pop, all...

The dollar remains under pressure; there is a debate as to the root causes of recent dollar weakness May auto sales will be the only US data release today; protests in the US are further denting Trump’s re-elections prospects, at least according to betting odds The G7 meeting planned at Camp David this month was postponed after German Chancellor Merkel declined his invitation Press reports suggest a possible compromise in the UK-EU trade negotiations; oil futures...

Our ruling elites, devoid of leadership, are little more than the scum of self-interested, greedy grifters who rose to the top of America’s foul-smelling stew of corruption. The Founding Fathers were wary of institutional threats to liberty and the citizenry’s sovereignty, which included centralized concentrations of power (monarchy, central banks, federal agencies, etc.) and the tyranny of corruption unleashed by small-minded, self-interested, greedy grifters who...

Flooding the financial system with “free money” only restores the illusion of stability I updated my How Systems Collapse graphic from 2018 with a “we are here” line to indicate our current precarious position just before the waterfall: For those who would argue we’re nowhere near collapse, consider that over 20% of the Federal Reserve’s $2 trillion spew of free money went directly into the pockets of America’s billionaires: $434 billion by the latest estimates,...