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Sober Look 181 posts 0 comments

Sober Look is a no-hype financial markets/macro blog that typically relies on data analysis, primary sources, and original materials. We keep it concise, to the point, with no self-promoting nonsense, and no long-winded opinions. If you are looking for Armageddon predictions or conspiracy theories, you will be thoroughly disappointed. Topics include financial markets, banking, asset management, risk management, derivatives, global economy, policy, and regulation, with the emphasis on finance education. Follow him on his blog or twitter.

Markets

U.S. house price affordability is very sensitive to interest rates

Sober Look Sep 9, 2013

We've had a great deal of movement in the NAR US Housing Affordability Index recently. The index is meant to measure homebuyers' ability to finance house purchases and given some recent events, it's worth taking a look at what the index is…

Markets

Distortions are evident in the U.S. mortgage market

Sober Look Sep 6, 2013

Something highly unusual is happening in the mortgage market however. Recently jumbo mortgage rates have been lower than conforming rates. This is one of those market dislocations that most would have never thought possible. Yet here we…

Economy

Chart of the day: QE3 has been ineffective in growing credit in the US

Sober Look Sep 4, 2013

Based on the data from the Federal Reserve Bank of St. Louis here is a single chart that shows credit growth in the US is continuing to decline while the Fed's balance sheet is expanding.

Economy

Raghuram Rajan to face impossible choices as India’s new central banker

Sober Look Sep 4, 2013

India is about to get a new new central bank governor, Raghuram Rajan, a University of Chicago economist with outstanding academic credentials. He is expected to start this Thursday, smack in the middle of a financial crisis the likes of…

Economy

Credit growth remains the weakest link in Eurozone recovery

Sober Look Aug 29, 2013

In spite of some positive economic signals out of the Eurozone, the area continues to struggle with credit growth. The latest loan growth measures still look quite bleak. We may however be seeing the first signs of the bottoming out of…

Markets

India: rupee in freefall, stagflation setting in, risks of sovereign downgrade and investor panic…

Sober Look Aug 28, 2013

This is beginning to sound like a broken record, but India's currency has come under severe pressure - again. India's central bank, the RBI, seems to have completely lost control over the rupee. The currency broke through 67 to the dollar…

Markets

Chart of the day: U.S. Treasury losses in perspective

Sober Look Aug 27, 2013

The histogram below shows the total return of long-dated treasuries over a rolling 4-month period since 2007. The leftmost bucket contains five periods that constitute the worst treasury losses since 2007. All five of these periods ended…

Markets

Tapering claims another victim: Indonesia

Sober Look Aug 26, 2013

In a fashion similar to what became known as the "Asian Contagion" in the late 90s, the current stress in emerging economies has been spreading. One of the nations to experience financial stress recently has been Indonesia, Southeast Asia’s…

Markets

How QE’s potential unwind reveals the existence of the currency wars

Sober Look Aug 21, 2013

Emerging markets currencies are getting hammered across the board today on the back of the FOMC minutes. Many are touching multi-year or even all-time lows. This provides further confirmation that the Fed's recent monetary stimulus effort…

Markets

India and Brazil should thank Bernanke for their currency woes

Sober Look Aug 20, 2013

For those who don't watch these currencies on a daily basis, these sell-offs seem to happen in spurts - almost at random. But there is a pattern here, particularly in the past few months. Investors are dumping these currencies during…