Credit Writedowns

News links for 5 Apr 2014

I have been saying for years now that the money multiplier does not adequately explain how money is created in a modern fiat money economy. In particular, the idea that banks are passive intermediaries who simply respond to injections of…

The US dollar is consolidating yesterday's gains that were scored largely in response to Draghi's revelation that QE and a negative deposit rate were discussed at the ECB meeting. The consensus expects that the US economy grew 200k jobs…

News links for 4 Apr 2014

I apologize but I am under severe time constraints today and cannot do the daily in time for the 10AM newsletter deadline. As I am out of the office tomorrow, I am not sure when I will be able to write. But I will have something for you.…

We are seeing signs of significant improvements in US labor markets. The ADP report today was certainly an indication of recovery from the winter slowdown. One area to watch in the ADP report is construction, as construction payrolls have…

Amazon. It is a highly-valued stock in the equities market – one that many point to as proof of a burgeoning technology stock bubble in the US. But for all the controversy over valuation, it is undeniable that Amazon is a big force in the…

Slovenia Raising Debt at Record Pace in 2nd 2014 Offering - Bloomberg This tells you the euro crisis is over until the next cyclical downturn: "Slovenia is raising debt at its fastest pace on record as the nation plans the sale of 2…

For years mortgage rates on "jumbo" loans have been higher than for traditional (conforming) mortgages. Since jumbo loans were larger than the upper limit permitted to be packaged and sold to Fannie and Freddie, banks would typically charge…

The US dollar is narrowly mixed, largely within its well-worn trading ranges against the major currencies with two exceptions. There have been several marginal developments over the 24 hours that are shaping the investment climate.