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
Category Archives: Federal Reserve
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
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
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
Trade Wars: Blue-on-Blue
The so-called ‘war’ over trade being conducted by the US & China has given rise to much ill-informed commentary about its supposed benefits, its prospective victims, and China’s putative responses. 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.
The CAPE of Good Hope
Though we have come to look a little askance at the seemingly ubiquitous CAPE measure – not least because of its gratingly unnuanced adoption by the Permabears – we can still utilise it to derive some broad sense of the market’s status once we attempt to adjust it for what we see as two of its bigger flaws: the seemingly arbitrary nature of the 10-year calculation period and its lack of regard for the effect of those wider asset valuations being expressed in the bond market that we have just touched on above. Continue reading
Pump’n’Dump
One of the prevailing stories which nervous market participants whisper to each other at bedtime involves the timely appearance of the Fairy God-mother, hastening to Earth from Tir Nan Og to launch another multi-trillion round of money-printing the instant that our over-inflated asset prices suffer any meaningful setback. This comforting narrative, however, presupposes three key elements…
A recent miscellany
Does it make sense to plot multi-decade asset prices on a linear scale? How reliable are macro ‘profit’ estimates? Why is the curve flattening and what will a reduction in Central Bank reserve balances mean for assets?
S0me recent short snaps from my LinkedIn & Twitter feeds plus you can watch my latest update ‘China: Unbalanced’ here, on YouTube Continue reading
Once through with feeling
Some readers may be interested in putting a voice – and even a face – to the author. Below are links to three recent audio-visual publications in which I discuss US & Chinese macro as well as the interrelations between the three great asset classes of stocks, bonds, an commodities. Following on is a wider sampling of my views. Continue reading