Tag Archives: 5) Global Macro

Nowadays, trade and “prosperity” are dependent on currencies that are created out of thin air via borrowing or printing. So here’s the story explaining why “free” trade and globalization create so much wonderful prosperity for all of us: I find a nation with cheap labor and no environmental laws anxious to give me cheap land and tax credits, so I move my factory from my high-cost, highly regulated nation to the low-cost...

In the first tentative step toward the final option available for Erdogan to halt the Lira’s accelerating collapse – which crashed as low as 7.2362 earlier after the Wellington FX open following the the Turkish president’s latest belligerent comments – namely capital controls, the Turkish Banking Regulation and Supervision Agency imposed a limit on the amount of foreign currency and lira swap and swap-like transactions,...

Stock Markets EM FX came under greater pressure last week as the situation in Turkey deteriorated.  With no weekend developments as of this writing, we expect Turkish assets to remain under pressure this week. Five worst EM currencies YTD are TRY (-41%), ARS (-36%), RUB (-15%), BRL (-14.5%), and ZAR (-12%). All five have serious baggage that warrants continued underperformance.Yet it’s worth noting that the five best...

We are delighted to announce a very special guest for our next episode of the Goldnomics Podcast, due for release later this week. We recently had the opportunity to speak with the legendary investor and adventure capitalist Jim Rogers. Jim is an American businessman, investor, traveler, financial commentator and author. He is the Chairman of Rogers Holdings and Beeland Interests, Inc. He was the co-founder of the...

Why is SHIBOR falling from an economic perspective? Simple again. China’s growth both on its own and as a reflection of actual global growth has stalled. And in a dynamic, non-linear world stalled equals trouble. Going all the way back to early 2017, there’s been no acceleration (and more than a little deceleration). The reflation economy got started in 2016 but it never went anywhere. For most of last year, optimists...

Consider how a “balanced portfolio” yielding “balanced returns” worked out for middle class retirees in Venezuela. The fantasy that a “balanced portfolio” yielding “balanced returns” will fund a stable retirement for decades to come is widely accepted as a sure thing: inflation will stay near-zero essentially forever, assets such as stocks and bonds will continue yielding hefty income and capital gains, and all the...

[embedded content] Economic thoughts and analysis from Alhambra Investments CEO Joe Calhoun. Related posts: Global Asset Allocation Update Global Asset Allocation Update Global Asset Allocation Update Global Asset Allocation Update Global Asset Allocation Update: Tariffs Don’t Warrant A Change…Yet Global Asset Allocation Update: The Certainty of...

The only way to pay all these future obligations is by creating new money. I’ve been focusing on inflation, which is more properly understood as the loss of purchasing power of a currency, which when taken to extremes destroys the currency and the wealth/income of everyone forced to use that currency. The funny thing about the loss of a currency’s purchasing power is that it wipes out every holder of that currency, rich...

Stock Markets EM FX has come under pressure again due to ongoing trade tensions and rising US rates but saw some modest relief Friday after the PBOC announcement on FX forwards. This helped EM FX stabilize, but we do not think the negative fundamental backdrop has changed. Best performers last week were MXN, PHP, and PEN while the worst were TRY, ZAR, and KRW. Stock Markets Emerging Markets, August 01 - Click...

Isn’t it obvious that those at the top of the wealth-power pyramid don’t want us to know how much ground we’ve lost while they’ve gorged on immense gains? In the late 1970s and early 1980s, an era of stagflation, the Misery Index was the unemployment rate plus inflation, both of which were running hot. Now those numbers are at 50-year lows: both the unemployment rate and inflation are about as low as they can go,...