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Brexit as Europe’s Lehman moment
I want to get to the Fed decision later today. But, before that, let me update you on Brexit under the rubric "Brexit as Europe's Lehman moment". I am thinking of it this way because many policy makers want to avoid the political and…
UK now closer to crashing out of the EU with no deal than ever before
Very quick here on Brexit.
British Prime Minister Theresa May has now submitted a formal request to the EU to extend the Article 50 time period to June 30th. The reason for the extension is that Britain has nearly run out of time, and it…
What the Fed needs to do this week to assuage the bond market
This is a follow-on to yesterday's post, where I argued that we are in a holding pattern regarding the thesis that global growth deceleration has ended. The equity markets are positioned as if that thesis is true. But the bond markets show…
Deutsche Bank, QT, the Fed’s outlook, the recent PMIs, and the Lyft IPO
No major catalysts in either direction
Right now, there are no major stories that I think will have any meaningful near-term impact on asset markets. We're definitely still in a risk-on market phase. And ostensibly, this is largely because…
Horrible continuing claims data speak to decelerating job growth
Real quick here.
I saw the jobless claims data today and thought they looked pretty good. But, I decided to go back to my 2008-2009 practice of sifting through the raw data for both initial claims and continuing claims. The numbers weren't…
The Japanification of Europe
Thinking about Japanification
Two FT articles and a discussion at Real Vision precipitated this post. On Monday, I had a conference call with a few markets-oriented colleagues at Real Vision, where I am an editor and program presenter. And…
US economy, Brexit, and the global slowdown during an equities rally
Equities continued their rally today, both in the US and globally. While the US rally was impeded by bad news for Boeing, the S&P 500 did eke out a gain on the back of a rally in tech. Cisco, for example, is up 29% since it bottomed on…
People are finally realizing that the jobs picture has weakened
It took the dramatic downshift in non-farm payrolls today for people to wake up to the drip-drip of weak jobs data coming out of the US. This put the equity market into a funk and caused bond yields to sink back to where they were on…
ECB’s reversal, covenant lite vulnerability, and delinquent mortgages
ECB stimulus
The biggest development today was the ECB's announcement that it is reversing its stance on stimulus and offering new bank loans:
The European Central Bank signaled a major policy reversal Thursday, flagging plans for fresh…
Bullish ISM data and some thoughts on stall speed
The February 2019 Non-Manufacturing ISM data were very bullish. Both the headline and the major subindices showed a lot of strength. And for me that indicates the 0.3% number on the Atlanta Fed GDPNow tracker will move up markedly as more…