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Yearly Archives
2018
The yield curve has now flattened into the danger zone
Quick post here. I caught a tweet by Bloomberg's Lisa Abramowicz this morning noting that the yield curve was at its flattest since the Great Financial Crisis. Looking at the data, I noted that the 10-year bond is trading at only 49 basis…
Facebook and the regulation of privacy
In 2012, to protect user privacy, the FTC mandated regulatory controls at Facebook that it has not made. Therefore, Facebook faces potential fines and greater regulatory oversight. This will be expensive, and could potentially cause…
Chinese officials are not acting like there’s a trade war
While the pundits are talking trade wars, Chinese officials are taking the latest US provocations in stride. China's emergence on the world stage was always going to be disruptive. China is not defenseless in a trade war, but many…
Cleveland Fed President Mester: Flat yield curve does not signal weakness
Cleveland Federal Reserve President Loretta Mester has joined the chorus of Fed officials trumpeting hawkish views. Note her comments about financial stability and reloading the Fed's interest rate gun. At the margin, these variables…
The euro area’s deepening political divide
Two European elections – in Germany on 24 September 2017 and Italy on 4 March 2018 – warn that the peoples of Europe are drifting apart. Much of the recent deepening of these divisions can be traced to Europe’s single currency, the euro.…
Links: De-dollarization, top down US policy and the new Cold War
As Trade War Heats Up, Biggest Currency Whales Make Their Move - Great article. Central banks are starting to diversify away from the US dollar. Many Wall Street strategists now see the euro as a viable alternative. My view: this shift…
Links: China tariffs, Italy, monetary offset and midterm turnout
Links on the Chinese reaction to tariffs, economic problems in Italy, the dangers of monetary offset for shares, and the importance of voter turnout for the midterm US elections.
John Bolton’s appointment by Trump confirms serious geopolitical risk
Donald Trump tweeted that he has appointed John Bolton as National Security Advisor. Bolton is a neo-conservative thinker with hawkish views on North Korea and Iran. His appointment is a sign that "Trump Unchained"is a change toward a more…
Facebook and the threat of cross-platform privacy leakage
Some of the best performing stocks in the US are the large Internet-centric technology stocks like Facebook. But Facebook's data breach represents a threat to them from regulators