With many commodity prices touching multi-year lows and with mounting fears for real estate valuations and car-lease residuals, numerous commentators seem convinced that ours is now a deflationary future. QE failed to raise CPI by anywhere near what the spin promised, they say, partly because it was ‘unsupported’ by fiscal policy. Therefore, if we don’t get Roosevelt, we’ll get Brüning, they conclude, and, meanwhile, we need the Fed to cut rates below zero, said one prominent pundit on April 5th. We replied:-
Category Archives: Cycles
Dog Chases Tail
The sharpening of the conflict between China and the US became all too apparent last week when Beijing released an official white paper in which it seemingly abandoned all hint of conciliation with a burst of accusations, exculpations, and a good deal of bluster. [First Published June 3rd] Continue reading
Consuming Folly
As promised, in this episode of Cantillon Effects, I have considered in much more detail whether there is such a thing as a ‘Consumer’ in isolation? I ask if a person’s role as producer is not more important. I look at the part played by interest rates, capital, and entrepreneurs, as well as by the state. I argue that worship of that False God – the ‘Consumer’ – not only slows economic progress in general and encourages heavy-handed and often harmful policies of intervention but also that it leads directly to the wastefulness of Boom and Bust. [To listen instead to Part I and Part II of my podcast on this, please go to CantillonCH at SoundCloud, or search Apple Podcasts here and here and Spotify for ‘Cantillon Effects’] Continue reading
Behind the Curve
The phrase on everyone’s lips at the moment is ‘Yield Curve’ – largely for its supposedly unerring ability to predict a recession if not, as its most extreme devotees seem to imply, actually to cause one. But is that a valid interpretation of what is afoot in financial markets and does that jibe with how the real economy is developing? To listen instead to my podcast on this issue, please go to CantillonCH at SoundCloud, or search Apple Podcasts and Spotify for ‘Cantillon Effects’. For an expanded PDF transcript of the yield curve discussion, complete with explanatory charts, please see 19-04-06 M4 No21
M4 Compendium (updated)
As a way of providing easy access to most of the regular work we have published over the past two years – and hence to getting a feel for what we do and how we do it – please see here for a collection in PDF form, offered in reverse chronological order. Continue reading
China Banking: Pigs Might Fly
There must be something in the air this winter – something that is besides the whiff of climate cant and manufactured eco-hysteria emanating from Davos and all the other organs of bien pensanterie. For, everywhere you look, someone is going less than quietly insane, either cooking up or Swedish chef rehashing glaring errors of economic idiocy or sweet-shop window socialism. Bork, bork, bork!
[This article can be heard as a podcast on Soundcloud under ‘CantillonCH‘ or iTunes under ‘Cantillon Effects‘] Continue reading
The Ph(o)enix Rises
Please find links to some of the commentaries made as part your author’s role as investment strategy adviser to Phenix Consulting & Asset Management over the course of 2018. ‘Market Movers’ provide updates on developments in and projections for commodity markets themselves while ‘Primary Concerns’ presents the L/S fund’s monthly results:- Continue reading
Central Banking: It’s alive!!
In his recent posting on Linked In, entitled, ‘The death of macro-prudential’, Stuart Trow of the EBRD delivered a well-aimed broadside at the pitiable conduct of the Bank of England and elaborated on some of the malign consequences of its catalogue of errors. Without wishing to single him out unduly for criticism for a piece with whose broad outlines I concur, I see it as a prime example of where even those who are not wholly in thrall to the cult of ‘Whatever it Takes’ often miss the critical features of that cult’s essential evil. Continue reading
The Turn of the Tide
Have we finally reached the high-water mark of the current bull run? Is all the good news in – and the last, most shaky, marginal buyer along with it, inveigled in by the bounce from February’s brief Vol-au-Vent? If so, what are the implications? Where are the trigger points? How will any weakness manifest itself? Continue reading
How the VIX Seller Lost his Shirt (updated)
Previously featured by the good folk at Real Vision, my look at how the narrative we construct around the events of the market is all important in determining how we react to it and, hence, what further ramifications these might involve.